This is the first of the provisions whereby the company must find remuneration for the directors. While that will not constitute a significant financial burden on the new companies, perhaps this is an opportune time to ask the Minister, since the Bill is silent on taxes and rates, whether section 343 of the 1967 Finance Act will be retained for harbour companies. What does the Minister envisage will happen in relation to municipal rates?
SECTION 31.
Question proposed: "That section 31 stand part of the Bill."
The municipal rates regime under which harbour authorities operate at present will, by virtue of section 83, continue in existence in relation to the new port companies.
We are having some difficulties with the acoustics. If Members wish to have a side conference, would they please have it outside the Chamber.
Can we raise the volume of the sound system?
I will ask the staff whether that is possible. If not, I ask Members to speak louder.
Under section 83, the municipal rates regime under which harbour authorities operate at present will continue in existence in relation to the new port companies. Section 83 provides for the adaptation of references in enactments to harbour authorities. The local taxation regime under which these authorities operate varies from harbour to harbour, as the Deputy knows. Similarly in relation to the tax regime, under section 83, the enactment to which the Deputy referred will continue in operation. This Bill does not change either the tax or the municipal rates regime that operates in relation to existing harbour authorities.
I wish to ask about subsection (2) which states:
An employee of a company who is appointed under section 30 (1) to be a director of a company and whose duties as such a director are not whole time shall not suffer any reduction in the remuneration which as an employee of the company, he or she would, if he or she were not such a director, normally expect to receive.
I am interested in the point being made in this subsection that a director could be employed in a whole time capacity. In what circumstances could the Minister see such a situation arising? In regard to employees who are appointed to the board of these new companies, what is their position in regard to their duties as an employee? Are they obliged to continue to carry out their duties in the position they held at the time they were elected as directors of the board of the new company and will they receive some level of remuneration as a director's fee? Could the Minister give us more information in regard to what level of fees will be paid? That is not the primary point I am making but it is a point that I wish to raise.
Set fees have been laid down in regard to directors of other semi-State bodies; is the principle that has been established in relation to those semi-State bodies to be applied to these new harbour boards? I would be interested to hear the Minister's views on these questions.
The intention is that fees paid to directors of the port companies will be modest in line with the practice that has been applied up to now in relation to other semi-State companies, but they will vary from company to company, because the size of the port companies concerned varies. The amount of directors' fees in a small port company like Wicklow or Arklow would not be of the same order as the fees paid to a director of Dublin port, for example. Even in the case of Dublin port, the intention is that the level of fees will be modest.
The section we are dealing with seeks to ensure that employee directors are not treated less favourably than other directors in the matter of allowances and that their pay as employees of the company will not be affected by the fact that they are also directors. The section provides that in determining allowances payable to directors, the company shall not distinguish between employee directors and other directors. This section provides that employee directors who are not full-time directors shall be paid the same amount in respect of their employment in the company as if they were not directors. The company will determine other allowances, for example, travelling expenses and subsistence allowances, and this section provides that the company shall not discriminate in such cases against directors appointed under section 30, that is, employees who are elected by their fellow employees to serve as employee directors on the boards of the companies.
It is not envisaged that the directors of any of the companies, including employee directors, would be full-time. The section provides a safeguard, however, that if at some time in the future it was decided to appoint an employee director in a full-time capacity, he or she would not receive pay as a director plus pay as an employee. Deputy Molloy asked about the normal duties of an employee who is elected a director. The normal duties of such an employee are not changed by this Bill. An employee director will be expected to carry out his or her duties as an employee and be subject to the same controls and disciplines as an employee as if he or she had not been elected a director of the company. The normal working conditions apply. What is provided for is that the employee director does not suffer either loss of earnings or any other disadvantage in relation to allowances paid to other directors.
Shall I put the question?
We are here to debate the Bill, Chairman, not to gallop through it.
Does the Deputy wish to raise another point?
Yes. The Minister stated that it will not be possible for a director to be appointed as a whole-time director, yet this section makes reference to a director appointed in a whole-time position. Why make reference to the possibility of a director being in whole-time employment if that cannot happen under the Bill?
It is not so much that it cannot happen as that it is not envisaged that it will happen. The intention is that all directors of the harbour companies appointed under this Bill will be part-time directors. The section is anticipating that if at some stage in the future either some or all directors of a company were appointed in a full-time capacity and if an employee director were appointed in a full-time capacity, that employee director would not be the beneficiary of remuneration in his or her capacity as a director and also his or her pay as an employee. It is simply to anticipate that if at some point in the future a decision is made that there is a need for some full-time directors and one of the full time directors was an employee director, the employee director would not be the beneficiary of a double income. The intention is that the directors will be part-time.
The Minister of State said that the scale of fees will be modest. There is a scale of fees for the existing semi-State bodies, ranging from larger bodies such as the ESB to Arramara Teo. Has it been determined where the harbour boards will come in that pecking order?
A pecking order has not been determined. However, if the Deputy is looking for a ball park figure, I envisage that directors of the larger companies will receive £2,000 at most and those of the smaller companies will receive less. The fees are relatively small.
The Minister of State said that when an employee is elected as a director of a company there is no change in his duties. Why do the rules he applies to the harbour companies differ to those which apply to other semi-State companies? Is the Minister of State saying that with all semi-State companies where an employee is elected as a director of that semi-State company he continues to carry out his previous duties?
That is the position, as I understand it. For example, if a postal worker is elected to the board of An Post he or she continues to do their normal duties. If there is a board meeting during their working day they get time off to attend the board meeting and are not penalised in terms of pay reductions and so on. The same will apply in the case of the port companies. Employee directors will be expected to carry out their normal range of duties and will be given time off to attend board meetings without a reduction in pay.
Does that rule apply to all semi-State companies?
Yes, as I understand it.
I think that this section has been adequately discussed.
I am raising a very important issue.
The Deputy has raised a number of important issues but I have to make progress. I have given the Deputy a great deal of latitude.
We are here to discuss the Bill and we can only speak once on Report Stage. It is not helpful to gallop along. In one semi-State company employees elected as directors of the board are not required to carry out their full duties. The Minister of State's information was interesting because it seems to imply that company is not complying with the rules and regulations which govern the employment of employees of semi-State companies. Different rules are being applied in different semi-State companies and the position should be regularised. One only has to look at the situation in the ESB.
I have no intention of commenting on the practice in individual semi-State companies. However, under this Bill an employee elected as a director of one of the port companies will be expected to fulfil his or her normal duties as an employee. The company, in turn, will be expected to facilitate that employee with time off without pay deduction to attend to their duties as a director of the company. The employee will not be disadvantgaged or advantaged by being a director of he board.
What is the position on remuneration or payment of expenses to local authority members on harbour boards at present? The Minister of State said the present position will continue to apply.
Directors nominated by a local authority and appointed to a harbour company will be paid the same director's fees as other directors of the company.
My question is as to the current position, which the Minister of State said will continue?
The position, as I understand it, is that they are not paid fees as directors but they may be entitled to claim travelling and subsistence expenses by virtue of their membership of the local authority.
Question put and agreed to.