As the Deputy is aware Government policy on banking remuneration has remained unchanged since the financial crisis. Extensive restrictions are in place, which, in summary, limit total remuneration for staff in AIB, Bank of Ireland and PTSB to €500,000 (excluding a standard pension contribution). Policy also dictates that bonuses and many other benefits cannot be paid to any staff. This policy impacts c. 23,000 workers across the three banks.
The Deputy will be further aware that I recently acknowledged that it is possible, in the future, that the context for bank pay could change; things are changing in the economy, Brexit is on the horizon and that will likely bring with it more intense competition for talent across the sector.
We are also likely to see more companies moving into Ireland, in the coming years, who will not be subject to the restrictions in the way that some of our banks are. With our economy almost back to full employment, the environment in which all of the companies who are based here operate has altered, and will continue to change. It is important that the right policies are in place to ensure a competitive but also a fair playing field.
For that reason, I have initiated a review of bank remuneration policy so that I can determine whether or not the bank pay policy that is in place is fit for purpose.
This will be done through the procurement of an external consultant to advise me on how policy in this area might best be developed in the future.
The review, I expect, will take most of the year to complete, and irrespective of what that outcome is, and what advice is given on the reintroduction of bonuses, the ‘super tax’, which sees 89% of bonuses being paid back to the State will remain in place. The power to alter that remains exclusively in the hands of the Oireachtas.