Professor Philip Lane:

Mr. Sibley covered this earlier. There are firms in Dublin and even more in London which pay more than that. Some individuals will decline to work for banks here in which there is significant State ownership because of the pay on offer. It is for the Oireachtas to decide the trade-off. Does it want the market forces to dictate that if the banks decide it is good value to hire people at higher salaries, they should be allowed to do so? In the context of public acceptability regarding a State-owned bank, is it prepared to wait to see what happens, maintain the cap and fill positions despite the fact that the bank may not get all the individuals it wants? I read that someone has been allocated a contract to evaluate the position in that regard. There is a need to consider the pros and cons of that. There is a genuine trade-off. We have always recognised that there is a good case for performance-related pay that is aligned with socially desirable incentives, especially in a volatile industry such as banking. When the economy slows down, their pay is cut and that provides a degree of stability. One also needs clawback mechanisms whereby any bonuses can be clawed back in the future over a long period if necessary. Have I missed anything?