Brian Cowen (Laois-Offaly, Fianna Fail)

I understand he is not receiving any additional pay or pension entitlements.

Contrary to how this is being portrayed, this is a payment into an overall fund that provides for pensions for most Bank of Ireland staff. If it was not made, the fund would be short of resources to meet its obligations to all Bank of Ireland pensioners and staff who will retire in future. It is a payment that is being made to the bank staff pension fund to sustain the agreed pension of the chief executive, a pension based on his salary, that is now controlled by the Government under the Covered Institutions Remuneration Oversight Committee. The payment is into the pension fund because, unlike public service pensions, it must be pre-funded and is to cover the contractual arrangements, allowing Mr. Boucher to retire when he is due to retire. This payment is as required. Contrary to speculation, it does not undermine the salary cap imposed by Government on the sector's executives and directors of the covered financial institutions that was introduced by Government last year.

The subscription agreement for recapitalisation provided that no pension enhancements would be awarded without prior consent. This is not an enhancement but the ongoing application of existing rules for chief executive officers. The oversight committee recommended pension arrangements for senior staff in the Bank of Ireland should be broadly similar to the generality of its staff and a significant review of the overall scheme is under way at present. Those are the facts of the matter in that situation.

The salary was capped at a very well remunerated level, although it is less than what the gentleman was on when he was head of retail banking. I do not hold any brief for that; I am explaining that the portrayal of this as a direct payment to Mr. Boucher is incorrect. It is a payment to the pension fund to ensure the pension already agreed under his contract is paid, as with other pensions in that fund for staff.

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