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Seanad Éireann debate -
Wednesday, 15 Nov 1972

Vol. 73 No. 10

Private Business. - Electricity (Supply) (Amendment) Bill, 1972: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

The purposes of this Bill are:

(i) to extend to the ESB general staff an improvement in superannuation benefits already enjoyed by the board's manual staff.

(ii) to eliminate any doubt which might arise as to the powers of the ESB to accord equal rank to all their borrowings.

Before proceeding to the individual sections of the Bill I should like to mention that the proposed amendments in sections 2 and 3 of the Bill are identical to those contained in sections 3 and 4 of the Electricity (Supply) (Amendment) Act, 1970, except that the two sections in the 1970 Act are in respect of manual employees while the two sections in the present Bill concern the general employees.

Section 2 of the Bill provides for the addition of a further subsection—subsection 9—to section 7 of the 1942 Act. The General Employees' Superannuation Scheme came into operation on 1st April, 1943. Where a general employee entered the board's service after 1st April, 1943, his service up to the date he was admitted to the scheme was not reckonable for superannuation purposes. Section 2 of the Bill defines this service as "previous service" and enables the board to reckon half of it for superannuation purposes.

Section 3 of the Bill enables the board to pay a supplementary allowance equal to the full pension value of the other half of a general employees previous service provided that the employees involved make a nominal contribution towards the cost of such an allowance.

Section 4 of the Bill refers to the borrowing powers of the ESB. Up to the time of the passing of the Electricity (Supply) (Amendment) Act, 1954, the board's capital requirements were borrowed from the Central Fund. All such borrowings under the Electricity (Supply) Act, 1927, and subsequent Acts carried with them either specific or floating charges on ESB property. Under section 4 of the Electricity (Supply) (Amendment) Act, 1954, the board were empowered to make their own arrangements for getting, direct from the public or otherwise, the capital required to finance their development and since then no money has been borrowed by the board from the Central Fund.

Section 4 (3) of the 1954 Act provided that the terms upon which capital is borrowed by the ESB may include provisions charging the moneys borrowed on the property of the board and also permitted the inclusion of provisions under which any charge in respect of money borrowed under the 1954 Act may rank before or equal with charges on the board's assets in respect of borrowings from the Central Fund. In fact, however, the ESB did not give any charges on their property in respect of borrowings under the 1954 Act and they do not envisage the giving of such charges in respect of future borrowings. As a consequence, the board are now advised that technically these borrowings under the 1954 Act cannot be ranked equally with the loans from the Central Fund in respect of which, as I have stated, a specific or floating charge on the board's assets was created under the Electricity Supply Acts. It was, however, the intention of the board that moneys borrowed under the 1954 Act would rank equally with loans from the Central Fund and the purpose of section 4 is to establish this position in law.

The amendments incorporated in this Bill cannot in any way be regarded as contentious. We should like to compliment the Minister and the ESB for coming back so quickly to remedy the difficulty that arose subsequent to the passing of the legislation in 1970. This speaks well for the Minister and the ESB. The board must be complimented on the excellent service they are continuing to provide. I hope that, with this additional piece of legislation, their service will improve and that it will lead to more harmonious relations between the board and their employees. It is most important that we should never again have to face the undesirable thought of having a strike in this very——

The Senator appreciates, I am sure, that matters of administration do not arise under this Bill.

I quite agree and bow to the Chair's ruling, but it is an opportunity of stating that we appreciate the difficulties that can arise in semi-State organisations. I just wished to compliment the board and their employees on their progress to date. I do not know if I am permitted to comment on the way the board expend some of the loan capital——

This is purely a narrow technical Bill relating to superannuation and borrowing matters. Questions of administration do not arise under it.

We cannot comment on where the borrowings go to or on the annual report?

I am afraid not.

Seeing that we have ordered so little business today, that is a pity. It would have been an opportunity to have a closer look at the workings of the board.

The difficulty is that the opportunities must be orderly ones.

I bow to your ruling. We are particularly glad that this amendment has been introduced in section 2. It will help to remove a bone of contention in the industry. Finally, again may I compliment the Minister for his very quick action in bringing in these amendments which we fully support?

The only criticism I have of the Bill is that it does not go far enough. The principal cause of discontent among manual and other workers in the ESB and other public service is that the superannuation schemes do not provide for increases in pensions in accordance with increases in the cost of living. Bearing in mind that the average rate of increase in the cost of living is about 12½ per cent, it will be seen that this complaint is justified. Perhaps it is not in order to speak on matters which are not covered by the Bill but I should like an assurance from the Parliamentary Secretary, if he is in a position to give one, that the Government have under consideration other improvements in the ESB superannuation scheme and those of other semi-State bodies.

There is just one small point I wish to put to the Parliamentary Secretary. I fully share Senator McDonald's satisfaction in relation to the Bill. Section 3 of the Bill, to which the Parliamentary Secretary referred, is the section which provides for admission to the benefit under the Bill on payment of a contribution by the employee. The Parliamentary Secretary referred to that as making a nominal contribution. Section 3 of the Bill refers to:

... a contribution equal to 1 per cent of the remuneration paid to him by the board during the three years immediately before his retirement.

I should like clarification as to what that means. Does it mean 1 per cent of the gross total over three years or 1 per cent of the remuneration paid in a single year? I hope the Parliamentary Secretary gets the point I am making. Do you gross the three years together and take 1 per cent of that figure or is it 1 per cent of an annual sum?

I wish simply to welcome the extension of the superannuation benefits in the Bill and also the technicality that the board's view of their borrowings should be recognised in law. Having said that, and appreciating that this is a technical Bill and that the debate must be brief, I should like to say that I think the whole financial structure and base of the ESB is a matter well worth deep discussion and serious consideration. I hope that this House will have the opportunity of considering these aspects more thoroughly in the near future.

I wish to thank Senators for the welcome they have given to this Bill. In reply to Senator O'Higgins, may I say that the provisions of the Bill in respect of the 1 per cent apply to the salary over the three years. I should like to draw his attention to the fact that it repeats the provisions of the Act of 1970 which introduced similar enabling powers in respect of manual employees. The Senator will be aware that the board's scheme is a contributory one. This particular provision preserves the principle of mutual financing of the superannuation scheme, requiring only the minimum contribution from the worker. In view of the benefits it confers, which I understand have been welcomed by the staff concerned, the amount payable is very modest; to that extent it is nominal.

It must be acknowledged that any scheme of this kind suffers from the disability mentioned by Senator Kennedy. It is a matter which the board must take into account when drawing up and implementing their schemes. It is also a matter to which the Minister for Finance must have regard, not alone in relation to the ESB but in any semilar scheme. The point is a relevant one and I will convey it to the Minister and to the Minister for Finance.

Question put and agreed to.
Agreed to take the remaining Stages today.
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