Tuesday, 14 February 2012
Department of Finance
Bank Guarantee Scheme
Michael McGrath (Cork South Central, Fianna Fail)
Question 185: To ask the Minister for Finance the extent to which he understands contractual and non-contractual bonuses continue to be paid by institutions covered by the eligible liabilities guarantee; and if he will make a statement on the matter. [8481/12]
Michael Noonan (Minister, Department of Finance; Limerick City, Fine Gael)
I refer the Deputy to my reply (ref: 41005/11 of 11 January 2012) on this subject when he last raised this issue. The respective operating agreements with the covered institutions, which underpin the State’s investments, contain prohibitions on the payment of bonuses save in exceptional circumstances such as meeting obligations on foot of a court order.
As has been the practice to date with pre-existing contractual rights, the legal advice that continues to be available is that such rights prevail and, as the Deputy will appreciate, with the passage of time such entitlements become less material in view of the prohibitions described above.