Written answers

Tuesday, 15 December 2009

Department of Finance

Redundancy Payments

11:00 pm

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Question 119: To ask the Minister for Finance the terms of the redundancy package which will apply to staff lay-offs at Anglo Irish Bank as part of the recently announced redundancy programme. [46678/09]

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
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On 4 November, Anglo Irish Bank announced the terms for a redundancy programme, seeking up to 230 redundancies, as part of a programme to reduce the cost base of the bank and to improve efficiency. The bank's preference is to realise the targeted reductions through voluntary means in Ireland and the UK. The terms are: In Ireland, 4 weeks' pay per year of service, plus statutory entitlement, to a maximum of 52 weeks pay; in the UK, 4 weeks' pay per year of service, inclusive of statutory entitlement to a maximum of 52 weeks' pay; in the US, 2 weeks' pay per week of service, to a maximum of 52 weeks' pay. This is the first phase of the bank's redundancy programme and is as a result of the planned reduction in the size of the bank due to necessary restructuring and the transfer of loans to the National Asset Management Agency (NAMA). The programme commenced on 9 November and will conclude in February 2010.

The bank has made it clear that there will be further reductions, similar in scale to the proposed reductions. Subsequent reductions in staff numbers will be framed against a review of Anglo's structures, processes and IT systems, and will be in line with the Restructuring Plan for Anglo, which will need to be approved by the European Commission under EU State aid rules. The bank submitted its Restructuring Plan to the European Commission on 30 November and a detailed and comprehensive evaluation of the plan is now underway, in advance of any final decision by the Commission on the plan. The final terms for departing senior executives or ex-Directors of the Bank must be approved by the Minister for Finance under the Relationship Framework for the bank, and the bank's proposals will be considered in that context.

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