Wednesday, 4 July 2012

Questions (208, 209)

Sandra McLellan

Question:

211 Deputy Sandra McLellan asked the Minister for Agriculture, Food and the Marine further to Parliamentary Question No. 462 of 26 June 2012, the persons who pay the wages of Moorepark staff, County Cork; if it is a private company or the Department of Finance; if it is a private company paying the wages, the reason the Department of Finance has control over the way they are paid and can stop wage agreements without negotiations and also acknowledge a Labour Court recommendation received in 2010 (details supplied); and if he will make a statement on the matter. [32522/12]

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Sandra McLellan

Question:

218 Deputy Sandra McLellan asked the Minister for Agriculture, Food and the Marine if a centre's (details supplied) employees benefited from the national pay awards for private sector workers negotiated in the context of national agreements, the reason the Department of Finance in 2008 stopped the first instalment of T16 — 3.5% — that was due to them in October-November of that year, as the increase at the time had already been approved by the company board of MTL and this increase was outside the Financial Emergency Measures in the Public Interest (No. 2) Act 2009; the grounds the Department of Finance had in 2008 to interfere with private sector workers pay outside of legislation; and if he will make a statement on the matter. [32720/12]

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Written answers (Question to Minister for Agriculture, Food and the Marine)

I propose to take Questions Nos. 211 and 218 together.

Moorepark Technology Ltd (MTL) is a subsidiary of Teagasc, the Agriculture, Food and Development Authority, with 57% of shares owned by Teagasc and the remainder by a number of dairying processing companies. As a subsidiary of a non commercial state agency, MTL is required to obtain Departmental approval for pay rates. It is also the case that under the ‘Articles of Association' for MTL, both the number of employees and their remuneration are subject to the sanction of Teagasc, the Department of Agriculture, Food and the Marine and the Department of Finance now the Department of Public Expenditure and Reform.

In the past, pay rates in MTL have been approved based on dairy industry norms and the application of private sector pay increases negotiated in the context of National Agreements. Staff salaries are paid from MTL's trading activities and Teagasc provide additional management support from its own resources

The refusal by MTL in 2009 to pay the 3.5% increase under the "Towards 2016 Review and Transitional Arrangement" was based on ‘inability to pay' at that time. The impact on the future cost of the public sector pensions of the claimants (i.e. the cost implications for public pension liabilities of the awarding of private sector pay increases) was also relevant. It is understood that most other private employers in the dairy industry have not paid the ‘Towards 2016 Review and Transitional Arrangement' pay increases on the basis of their ‘inability to pay'.

In addition to inability to pay, cognisance must now be taken of the introduction, in December 2009, of the Financial Emergency Measures in the Public Interest (No. 2) Act 2009. MTL is deemed under this legislation to be a "public service body" inter alia by virtue of the fact that they have a public service pension scheme. MTL is, therefore, statutorily prohibited from increasing pay rates and the pay reductions specified in the Act must apply to the staff of MTL. The Financial Emergency Act also takes precedence over the Labour Court findings in LCR 19725 on the status of MTL staff, which was made just after the enactment of the legislation.