Eoghan Murphy (Dublin South East, Fine Gael)
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Question 184: To ask the Minister for Finance if any consideration has been given to altering the remuneration policy in the Irish Bank Resolution Corporation in order that it is in line with the public sector in view of the fact that the bank is fully nationalised. [21580/12]

Michael Noonan (Limerick City, Fine Gael)
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I have asked the Board of the bank to consider the remuneration packages at the bank. The Board has considered reductions in pay levels for individual staff in IBRC but has however, recommended to me its view that pay cuts should not be implemented at this time. The decision not to pursue pay cuts is on the basis that staff retention is a critical issue for IBRC. There has been considerable reduction in staff numbers and current staff are being regularly headhunted by Banks and other organisations. It is the Board's view that further pay cuts would create a risk for the bank in relation to the retention of staff and would impact negatively on the bank's ability to deliver its mandate.

The Board has indicated its view that the skills of staff within IBRC are integral to the successful delivery of the bank's asset recovery programme on behalf of the State and, by extension, the taxpayer. In this context, IBRC have also pointed out to me that a 20% reduction was applied to the salaries of senior management in the former Anglo Irish Bank immediately post nationalisation. These adjusted lower salaries have remained in place in the organisation for subsequent replacements to those roles. It should also be noted that IBRC does not operate a performance based incentive plan. The bank had further indicated that total remuneration paid to the top 50 individuals in the organisation in 2009 has reduced by 15% as at March 2012. In addition, total staff costs in the organisation have reduced by 48% from end 2008 to end 2011 and this includes 6 months of additional cost resulting from the merger with INBS in 2011.

Since nationalisation there has been a 60% reduction in total headcount in the combined Anglo Irish Bank and INBS organisations from close to 2,250 in January 2009 to 919 today. IBRC also employs 184 front line staff in its NAMA servicing unit. As part of this reduction, there has been an extensive re-structuring and streamlining of the management structures in IBRC. Of the 50 most senior people employed pre-nationalisation, 34 (or 68%) have since left the Bank. I have accepted the Board's position at this time. However, I have asked that the situation in relation to remuneration be kept under review. I have also conveyed my view that downward pressure is to be exerted in relation to the remuneration packages of any new staff recruited to the bank.