Wednesday, 7 March 2012
Question 11: To ask the Minister for Communications; Energy and Natural Resources if he will rule out the State bearing the full incidence of funding the deficits of ESB and Bord Gais when they are part privatised; and if he will make a statement on the matter. [12876/12]
The Government has decided that Bord Gáis Éireann's energy business and some of the ESB's non-strategic power generation capacity will be part of the State assets disposal programme. The Government is irrevocably committed to retaining the Bord Gáis transmission and distribution networks as well as the gas interconnectors in State ownership as national strategic infrastructure and fundamental to Ireland's security of energy supply and the economy.
The Government has also reiterated its commitment to retaining the electricity networks in State ownership and to retaining the ESB as a vertically integrated utility in State ownership as a strong strategic player in the all-island energy market and in due course in the integrated European market.
Both the ESB and Bord Gáis recorded a net profit in their most recently published financial statements. I assume that in referring to the deficits of the ESB and Bord Gáis the Deputy has in mind the deficits in the pension funds of those companies. I note the boards of management and employees of both the ESB and Bord Gáis have already agreed and are implementing measures to address the deficits in their respective pension funds.
In the context of the asset disposal programme, my Department, in co-operation with the Department of Public Expenditure and Reform and with the assistance of NewERA, is currently undertaking the necessary analysis to identify the policy, regulatory, legislative and financial issues that may need to be addressed prior to any disposal. Consideration of any identified potential pension issues as a result of this analysis will form part of the further detailed due diligence work required prior to any divestments.
I would emphasise that a guiding principle of the assets programme is ensuring that the best possible value is derived for the State, not least given that part of the proceeds can be used for re-investment to support employment and economic recovery. This underlines the imperative to ensure that the preparatory work is comprehensive and to the highest standard prior to any proposed divestment of assets from either the ESB or BGE.
We aired some of the issues relating to the question earlier on the policy of Government on privatisation or part-privatisation of State assets. It is important that the Government would pursue an agenda to provide for the creation of a register of lobbyists prior to any privatisation of State assets in the interests of transparency and accountability. We know the high-profile household names, former politicians for example from the Minister's party, the Fine Gael Party and my party, who now engage in the business of lobbying. They are above the radar but there is an army of people engaged in the lobby industry who are not household names who operate below the radar and who will potentially play a major part in lobbying and seeking to influence Government policy in this regard. It is incumbent on the Government to establish a register of lobbyists prior to going any further down the route of privatisation.
I agree with Deputy Collins that we traced the issue of the pensions previously. We can be proud of the progress made in the two companies concerned on the pension issue because pensions generally have been affected right across the economy, defined benefit pension schemes in particular. The agreements entered into are landmark agreements that might well be replicated elsewhere. That is very positive.
As regards the regulation of lobbyists, I agree with Deputy Collins that it is desirable. It is the nature of modern politics imported from the United States that one could get knocked down at the gate by lobbyists coming at one on behalf of their clients for access in various ways. I do not have any particular objection to companies using PR people to make such representations so long as - as Deputy Collins said - it is transparent. In many cases I do not understand why the companies themselves do not do the task rather than employ people to do it on their behalf, but that is a matter entirely for them.
On the sale of State assets, I put it to the Minister that he might consider the possibility I will outline instead of selling the land or forestry of Coillte outright. His Department, in conjunction with the Department of Agriculture, Food and the Marine, could examine the possibility of long-term leases for wind farm developers. The State would have none of the risk. Much of the land owned by Coillte is in areas where we have wind speeds that are suitable for wind farms. We could still maintain some of the asset that is the forestry. It would allow the State to access some of the value of the lands without risk.
I acknowledge that the Deputy has a point that desires being entertained because we must continue to build up our renewable capacity. We cannot have windmills at every crossroads in the country. It is desirable that wind farms ought to be clustered. The availability of land is most apparent in the case of some State companies, Coillte and Bord na Móna in particular, and we must have regard to that in any decision that is implemented in respect of the agreement with the troika.
I have had some discussions on the matter with my colleague, the Minister for Agriculture, Food and the Marine, Deputy Coveney. In any event, I hope it is understood that the State does not propose to sell Coillte. As the proposal currently stands the intention is to examine the sale of the harvesting of the timber but not to sell the land. Deputy Mulherin has made an important point in terms of our capacity to carve out provision for the kind of development to which she referred. I confirm that the Minister for Agriculture, Food and the Marine, Deputy Coveney, and I are currently having discussions on the matter.