Brendan Howlin (Wexford, Labour)

In June, 2011 the Government took two significant steps on the payment arrangements of CEOs in commercial State bodies. First, we introduced a general pay ceiling of €250,000 per annum in the case of newly appointed CEOs in commercial State companies, along with reductions to similar appointees in such companies with lesser pay ceiling levels. Second, we sought voluntary reductions in the remuneration levels of serving CEOs with salaries in excess of €250,000 per annum. The sole exception is in respect of the newly appointed CEOs is in the ESB, for whom a salary was approved which is proportionate to the reductions imposed generally.

The position in respect of already serving CEOs is that for contractual reasons the imposition of reduced salary rates could not be unilaterally proceeded with by Government. However, incumbent CEOs in the commercial State companies with a salary in excess of the general salary ceiling of €250,000 per annum were requested to make a voluntary waiver of salary of 15%, or to waive a lesser amount if the application of the full 15% reduction would have brought their salary below the €250,000 salary ceiling. All of the relevant incumbent CEOs whose salaries were in excess of €250,000 per annum agreed to the application of the waivers.

The current system of performance-related award schemes for the CEOs of commercial State companies is being reviewed in conjunction with the relevant overseeing Departments in order to consider whether it would be appropriate to amend the operation of these schemes and to provide for more direct input and oversight by Ministers.

With regard to CEOs of non-commercial State agencies, in June 2011 the Government introduced a general pay ceiling of €200,000 per annum for future appointments in the public service. This ceiling continues to apply. The policy could not, for contractual reasons, be applied to incumbents. A voluntary waiver of salary of 15%, or the ceiling of €200,000, was requested. Only a small number of such bodies continue, as they are legally entitled to do, to operate performance-related award schemes for their CEOs. The remuneration of CEOs in both the commercial and non-commercial State sectors has undergone significant reductions. Future policy developments on the determination of remuneration at the level of CEO will require ongoing consideration in the light of the changes that have already been introduced.

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