Joan Burton (Dublin West, Labour)
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Question 187: To ask the Minister for Finance the actions and measures he has put in place to ensure that the remuneration packages of senior executives in the financial institutions covered under the Government guarantee in 2010 are in accordance with the recommendations of the Covered Institutions Remuneration Oversight Committee report; if he has sought advice from CIROC on this matter; if he has requested the CIROC to undertake further work or supervision of remuneration policies and packages since they submitted their report in March 2009; and if he will make a statement on the matter. [25668/10]

Joan Burton (Dublin West, Labour)
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Question 188: To ask the Minister for Finance the actions he has taken since March 2009 to further review the remuneration plans and policies of financial institutions in view of the recommendation by the Covered Institutions Remuneration Oversight Committee in their report of March 2009, section 1.13, that the remuneration plans of the financial institutions covered under the Government guarantee required further review since the CIROC committee did not have access in March 2009 to all the relevant information to confirm if the institutions were complying with section 47 of the guarantee scheme; and if he will make a statement on the matter. [25669/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 187 and 188 together.

Under the terms of the Credit Institutions (Financial Support) Scheme [the Scheme], I established the Covered Institutions Remuneration Oversight Committee (CIROC) to oversee all remuneration plans of senior executives of the covered institutions. Paragraph 47 of the Scheme 2008 required that each covered institution prepare a plan to structure the remuneration packages of directors and executives so as to take account of the objectives of the Credit Institutions (Financial Support) Act 2008. For this purpose, remuneration includes total salary, bonuses, pension payments and any other benefits received from a covered institution and its group entities, or otherwise received by a director or executive arising from the performance of his or her functions as a director or executive. These plans covered executive bonuses including share options, if any.

CIROC reported on 27 February 2009, recommending reductions in prevailing base salary, bonus and pension levels for Chief Executives, Chairs and ordinary board members that it considered to be, in many cases, markedly excessive. These recommendations were then to be incorporated in revised remuneration plans of the covered institutions to reflect compliance with the Act.

CIROC fulfilled its mandate by submitting its report to me in February 2009 on the covered institutions and has no further function under the terms of the existing scheme. However, through the terms of the respective subscription agreements and/or relationship frameworks, the Government has implemented further controls on remuneration policy at the respective covered institutions beyond the provisions of CIROC.

It can be seen from the publication of the respective 2009 financial statements of the covered institutions that, taking the above into consideration, the recommendations of CIROC are generally been implemented and accordingly the objectives of Act are being taken account of by the covered institutions in setting their remuneration policies. The Deputy will be aware that exceptions to some of the CIROC recommendations have been made but these were subject to approval in advance based on particular circumstances.

On the specific issue of "pension cap" practice noted by CIROC and their view that it was unacceptable that arrangements should be put in place which would be inconsistent with the intent of the relevant legislation I specifically informed the affected institutions that this practice should cease immediately and this has happened. At two of the covered institutions payments continue to be made because of pre-existing contractual arrangements to four individuals. In all of these cases reductions in base salary and/or the "pension cash payment" have been made.