Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

I thank Deputy Cowen for raising this important issue and I acknowledge the presence of Deputy Eugene Murphy. It is an issue close to all our hearts. As Deputies Cowen and Murphy are aware, Bord na Móna is facing significant business challenges in the context of the deregulation of the electricity market and increasingly competitive and challenging environments across all its business areas. In order to ensure its continued success and survival, the company is implementing a programme to transform all areas of its operation and structure, the key objective of which is to improve business efficiency and effectiveness. In April 2016, following a series of negotiations with the assistance of the Workplace Relations Commission and the Labour Court, Bord na Móna reached agreement with the Bord na Móna group of unions on pay progression and new working methods across a range of issues related to business transformation.

The specific matter raised by the Deputy is an operational matter for the company and not one in which I as Minister have a function or role. I have, however, sought a report from the company on the issues raised and am informed that the matters referred to by the Deputy cut across two specific areas. With regard to rail transport, I am advised that Bord na Móna transports peat to its three peat-fired power stations via its rail network. This work is carried out in accordance with the standards laid down in respect of the work methodology. Bord na Móna has confirmed that it is normal practice dating back many years to periodically review these standards to see if they can be updated to reflect developments, for example, in technology. I understand that this was done by an industrial engineer who reviews current practices and redefines standards.

The recently adopted general agreement under the WRC makes provision for this matter. Bord na Móna informs me that the loading and haulage work standards, which were outdated for many years, were reviewed during 2015 and updated in June 2016 to reflect modern equipment and workplace practices. I am advised that the new arrangements have resulted in reductions in bonus payments, in some cases by up to 12%. Bord na Móna has assured me that the Workplace Relations Commission agreement mentioned above clearly covers the adjustment and sets out an agreed compensation arrangement.

With regard to the outsourcing of services, I am advised that Bord na Móna currently transports some peat by road, which is quite expensive. Between 15% and 20% of all peat sold is transported by road. Bord na Móna's peat business has ten trucks and 18 permanent drivers, which carry approximately 60% of the peat transported by road. The remaining 40% is carried by third-party trucks. An analysis of the internal cost per tonne transported versus the third-party cost per tonne transported found that significant cost reductions could be realised if the road haulage was outsourced. The WRC agreement provides that outsourcing could be introduced where it results in cost savings, provided that employees are given the option to redeploy within Bord na Móna on their current terms and conditions. I am informed that the company has advised the unions that it intends to implement this outsourcing by 1 September 2016 and that all drivers will be deployed within the business on current pay terms. I understand that discussions are ongoing between the company and the unions on this matter.

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