Wednesday, 10 Jun 2015

Written Answers Nos. 71-78

IBRC Liquidation

Questions (71)

Michael McGrath

Question:

71. Deputy Michael McGrath asked the Minister for Finance in view of his confirmation that his Department was in receipt of the minutes of board meetings at Irish Bank Resolution Corporation prior to the putting in place of a new relationship framework with the corporation in March 2012, the procedure that was in place within his Department for reviewing those board minutes, and for following up on any issues arising from those minutes, that raised concerns in his Department. [22649/15]

Written answers

Minister for Finance

The Shareholding Management Unit (SMU) was responsible for managing the day to day relationship with Anglo Irish Bank and subsequently with IBRC.

A senior member of the SMU was assigned as the point person for the relationship with support from other members of the team.

Upon receipt of the monthly board packs, the papers were reviewed and any matter arising from a review of these packs would have been escalated within the SMU and the Department.

The review of the board packs in conjunction with a review of other material and reports received from the bank would have formed the basis of follow up queries and meetings with the management and board of IBRC as appropriate.

IBRC Liquidation

Questions (72)

Michael McGrath

Question:

72. Deputy Michael McGrath asked the Minister for Finance the date he learned that the actual loss to the Irish Bank Resolution Corporation on the Siteserv transaction in 2012 was €119 million, as recorded in the minutes of the board meeting of the corporation on 15 March 2012; and if he will make a statement on the matter. [22650/15]

Written answers

Minister for Finance

Details of the approval of the Board of the sale and the financial impact to IBRC of the sale of Siteserv, including details of the proceeds, process and the €119 write-off, were included in the minutes of the meeting of the board of IBRC on 15 March 2012. The Siteserv transaction was announced to the Stock Exchange on 16 March 2012 and the Department received the minutes of the meeting as part of the monthly board pack later that month.

In its publicly reported half year results for the six months ended 31 October 2011, Siteserv reflected "Interest bearing loans and borrowings" of €156 million. The Stock Exchange announcement of the deal cited a cash consideration of €45.42 million at completion. It is understandable that based on these publicly disclosed figures, various commentators speculated that the resulting write-down suffered by IBRC amounted to c.€110m, being the difference between €156 and €45 million.

The minutes reflect that the board approved the proposal to proceed with the Sale of Siteserv for €48m with net proceeds for the bank of €44.3m arising from the sale of Siteserv in repayment of its outstanding borrowings. The proposal approved by the board included a write-off of the balance of the IBRC lending facilities of €119 million following the sale.

The concerns expressed by Department officials and raised by my officials and I in meetings with the management and board of IBRC in 2012, as contained in records previously released under FOI, focused on the execution and management of the sales process and whether the decisions taken maximised the potential proceeds from the sale. As can be seen from the records released under FOI the focus of the meetings was on the critical decisions taken by the bank and possible alternatives during the sales process and the proceeds would also have been discussed.   In my discussions with IBRC in 2012 I was aware that a very significant write-down resulted from the sale. In addition, both the publicly available information and the details contained in the board minute would have been known to Department of Finance officials at that time.

The assurances I sought from the Chairman of IBRC was to ensure the maximum return was achieved for the taxpayer from the sale process.

Public Sector Pay

Questions (73)

Terence Flanagan

Question:

73. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform the position regarding public sector pay increases (details supplied); and if he will make a statement on the matter. [22560/15]

Written answers

Minister for Public Expenditure and Reform

The Financial Emergency Measures in the Public Interest Acts 2009 and 2013 made specific provision that where the remuneration of  public servants was reduced under those Acts, those reductions could be disregarded for the purpose of calculating any pension entitlement for certain periods of time. However the calculation of pension and retirement lump sum to be awarded to a person retiring from pensionable public service employment is normally based on the particular pay rate actually being received by that person at the time of retirement. Accordingly, those retiring before the application of the relevant pay increases will not have the pay increases included in the calculation of their pensionable pay. I have no plans to alter that position.

Industrial Relations

Questions (74, 75)

Terence Flanagan

Question:

74. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform the position regarding the public sector agreement (details supplied); and if he will make a statement on the matter. [22561/15]

Terence Flanagan

Question:

75. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform if he will address a matter (details supplied) regarding the public sector agreement; and if he will make a statement on the matter. [22562/15]

Written answers

Minister for Public Expenditure and Reform

I propose to take Questions Nos. 74 and 75 together.

The recently announced proposals formulated by the Labour Relations Commission in relation to the Lansdowne Road Agreement provide inter alia for a 2.5% pay increase for public service pay levels up to €24,000 per year in 2016 and a €1,000 pay increase for remuneration levels up to €65,000 in 2017.

In general, and leaving aside the special case of "grace periods" under the financial emergency legislation, the calculation of pension and retirement lump sum to be awarded to a person retiring from pensionable public service employment is based on the particular pay rate actually being received by that person at the time of retirement. I have no plans to alter that position.

Public Sector Pay

Questions (76, 77, 78)

Terence Flanagan

Question:

76. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform his views on a matter (details supplied) regarding the public sector agreement; and if he will make a statement on the matter. [22563/15]

Terence Flanagan

Question:

77. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform the position regarding the public sector agreement and increases in pay (details supplied); and if he will make a statement on the matter. [22564/15]

Terence Flanagan

Question:

78. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform if the public sector agreement published is the full agreement; and if he will make a statement on the matter. [22565/15]

Written answers

Minister for Public Expenditure and Reform

I propose to take Questions Nos. 76 to 78, inclusive, together.

These questions all relate to the recent Labour Relations Commission  proposals for the extension to the Public Service Stability Agreement to 2018, under the title of the 'Lansdowne Road Agreement'.

Following the conclusion of discussions on pay and reform in the public service on 29 May last,  the negotiators on both sides, with the expert assistance of the LRC which oversaw the talks' process, have come forward with a set of proposals to form the basis of a single new agreement, the Lansdowne Road Agreement, which will comprehend the whole public service and will extend the terms of the Haddington Road Agreement to September 2018. It is now a matter for Union and Association members representing the public service workforce to consider and ballot on those proposals. The proposals, should they be ratified by the Unions and Associations, will secure an Industrial Relations framework that will foster and support further productivity and change at the level of the workplace. The proposals also provide for the commencement of the gradual unwinding of the Financial Emergency Measures in the Public Interest legislation, which was put in place in response to the financial crisis. The partial unwinding of the pay reduction measures imposed on public servants is prudent and sustainable in the fiscal space currently available to Government.

The proposals on pay include a mix of reductions in the Pension Related Deduction (which will not affect the rates of gross pay) and pay increases (which will raise the level of the relevant salary scales). New recruits to the public service will be assigned on the basis of the payscale actually in place at the time. Increases made to pay rates are applied to each relevant salary scale point to the threshold involved, such as the 2.5% increase from 1 January 2016 for those earning up to €24,000. Overtime rates may be impacted where they are a percentage or a multiple of basic scale earnings. It should be noted however that the multiples applicable to overtime rates were reduced under the terms of the Haddington Road Agreement and those reductions are not affected by the new proposed Agreement. Where a payment is at a fixed rate, or a rate not associated with base pay rates, then there will be no consequential impact from any percentage increase in pay.

Subject to agreement by the Unions and Associations on the proposals made, I will bring forward the necessary legislative amendments  to enable  the terms of the Agreement to be implemented from 1 January 2016.