Sandra McLellan (Cork East, Sinn Fein)
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To ask the Minister for Finance the number of staff that are on a total remuneration package including pension payments, allowances and benefits of between €100,000 and €200,000, between €200,000 and €300,000, between €300,000 and €400,000 and the number with more than €500,000 at Allied Irish Bank. [50510/12]

Michael Noonan (Limerick City, Fine Gael)
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AIB has provided me with the following information on current annual total remuneration packages:

* AIB had 14,501 members of staff at the end of 2011

AIB fully recognises the absolute requirement to reduce staff costs across all areas of the business as they seek to return the bank to viability and drive value for the State as shareholder. The bank has taken, and continues to implement, changes to its pay and benefits structure within the confines of contractual obligations and seeking agreement with the Unions.

AIB has taken the following specific actions to address remuneration levels: reductions in pay and benefits of higher earners ranging from 7.5% to 15% implemented in H2 2012; defined benefit pension scheme to close from end 2012 for future service; other long standing staff benefits have been withdrawn. For other staff a pay freeze has been in operation since 2008 and the bank is in discussion with the IBOA to extend this to 2014.

A voluntary severance program aimed at reducing staff numbers by 2,500 by 2014 is ongoing. This program is weighted to candidates exiting under early retirement as this population of staff, given their length of service, would typically be amongst the highest historical earners. AIB is on track to meet its target of 2,500 voluntary departures and this is expected to result in annual savings to the bank in excess of €200m.

AIB is fully participating in the Government’s review of remuneration levels in the Covered Institutions. Including pensions and all other applicable benefits there are no staff members in AIB earning in excess of €500,000 per annum.

Excluding benefits and pensions, as of November 2012, c. 5% of staff have a base salary in excess of €100,000. Of these staff members, c.59% earn a base salary of between €100,000 - €125,000 and c. 91% earn a base salary of between €100,000 and €175,000. The number of staff earning more than €100k on a base salary basis has reduced by 15% since Dec 2011 and 31% since end 2008. By end 2012 the number of staff on base salaries of greater than €100,000 is projected to decrease to 700 staff, or a reduction of 18% from end 2011 or 33% from end 2008.

AIB is in the process of implementing changes to staff pensions and benefits with discussions ongoing with staff and the Unions. AIB is committed to ensuring that all elements of pay, including base pay and benefits, are in line with the bank’s operating performance and recognise the materially altered environment for Bank’s operating in Ireland. All changes need to be made against a backdrop of historical contracts that were put in place in a different operating and ownership environment.