Dáil Éireann Debate, Thursday - 21 November 2013
2. Deputy Mary Lou McDonald asked the Minister for Public Expenditure and Reform the challenges the current difficulties regarding the ESB pension scheme will have for the programme of State asset disposal his Department is overseeing; and if he will make a statement on the matter. [49663/13]
Amharc ar fhreagraThe Minister is aware that the issue of the deficit in the ESB pension fund has been a long-running controversy and concern, and it now stands at €1.6 billion. He is probably aware that in 2010, ESB management on a solo run changed the accountancy treatment of the pension fund from direct benefit to direct contribution, shifting all the liability to the workers. In an effort to keep the liability off the balance sheet, the company subsequently borrowed very heavily on the international markets, having presented the balance sheet in an erroneous fashion. Now ESB workers have balloted for industrial action and we face the prospect of the first ESB strike in decades. The Minister's officials and the Departments which have promised dialogue have not been in touch with ESB management and unions since last June. What is the implication of this for the disposal of the assets?
In so far as this issue relates to my Department, it relates to the sale of State assets; the responsibility for the ESB does not fall within my Department and I am not going to respond on that matter. With regard to the dispute concerning the manner in which the ESB currently accounts for its pension liabilities, I do not envisage that the matter will have any impact on the disposal by the ESB of its assets. These assets have been identified for disposal and I am confident the programme of asset disposals will proceed as planned.
In 2010, the ESB management without agreement of workers or unions changed the treatment of the pension fund for the purposes of cleaning up its balance sheet. The Government had to sign off those accounts so I do not accept the Minister's position of not commenting on the matter. He should do so and he must do so, and I hope he will take the opportunity today to speak on it.
Was the Minister or the Government aware of the change in the treatment of the pension fund? It was not minor but it was a very significant shift in how the pension fund and its deficit were accounted for. The Government signed off on that but was it aware of the implications when it did so? Does the Minister appreciate the implication for the workers in the ESB, who now find themselves in a position where the management wishes to shift the burden of all that deficit on to their shoulders? This relates directly to any proposed disposal of any part of this State asset. Does the Minister appreciate the gravity of a position where a semi-State company alters its balance sheet in this manner to affect its credit rating for borrowing on the international markets? These are serious matters in the public domain and I do not accept that the Minister cannot comment on them.
The Deputy is making very serious charges about altering accounts and it would be proper for her to deal with the line Minister, who has all the information relating to the issue. She has spoken of the Government collectively signing off the accounts, I presume, as they are not a matter for me. The Government collectively receives the report of the ESB and every other State agency and these are dealt with by the line Minister. This is a matter for the Minister for Communications, Energy and Natural Resources, and he has all the details relating to it. The description of the pension schemes in the accounts is a matter that could be properly explored with the people having the best information, and I do not have it.
The ESB in general is one of the most robust institutions in the State and there is no question of a hole in its pensions unless everybody in it was to retire next Monday, crystallising the cost. I heard a statement the day before yesterday from the Minister for Social Protection, who is responsible for pensions policy generally, and she has indicated the company is working to a scheme that will have a robustness by 2018. These matters would properly be addressed to the Minister for Communications, Energy and Natural Resources.
I do not accept that. The Minister is proposing to oversee the sale of part of this State asset. The due diligence involved in this, from the Minister's perspective, must mean he has been through this company like a dose of salts, establishing its exact position. It is a bit hard to believe he would miss the magnitude of the hole in the pension fund in the ESB. I also find it strange or remarkable that the Minister has not yet been apprised of the actions of ESB management in 2010; that was a very deliberate act to change the description and treatment of the pension fund from a defined benefit fund to a defined contribution fund. The implications for the workers are enormous, and the consequences for the company could be very significant. This company is borrowing on the international markets, based on a credit rating directly linked to its balance sheet.
The Minister is passing the buck to another Minister, Deputy Rabbitte. E-mails in the public domain have been commented on by the media a number of weeks ago. The line Minister to whom the Minister opposite has referred ran for cover at that stage and had nothing to say, it seems. It is unacceptable that the Minister, who has told us he will oversee the sale of part of this company, is singing dumb on the matter. He might be running for cover too.
I am impressed by the view of the two main Opposition spokespersons on the capacity of my Department. Deputy Sean Fleming wants me to micromanage the HSE-----
This is not micromanaging.
-----and Deputy Mary Lou McDonald thinks I should micromanage each and every one of the State companies.
That is rubbish.
My Department has a large reach, but that is a bit much. The line Minister with responsibility for knowing the detail of the ESB is the person best placed to answer the Deputy’s question.
Therefore, the Minister does not know anything about it. That is astonishing.
The Minister should be allowed to conclude.
I know the Deputy has no more interest in getting accurate answers that she does not bother with the line Minister who I am sure would be very happy to answer any question or respond to a matter raised in the Topical Issue debate.
Strangely enough, the Topical Issue has not been selected.
It is probably more useful from a soundbite perspective to make a statement as opposed to getting information by way of question and answer.
Then give me the information.
