State utility firms told Minister chief executive pay limits posed ‘serious risks' to organisations
The chairs of the boards of
Gas Networks Ireland
(GNI),
Uisce Éireann
and the
Land Development Agency
warned last year that restrictions on pay for their chief executives posed 'real and serious risks' to the organisations.
In a note to the Senior Posts Remuneration Committee, established last year,
Department of Housing
secretary general Graham Doyle said the boards of GNI and Uisce Éireann had also expressed 'serious concerns ... about the potential loss of the CEO at a critical time for both companies'.
According to submissions sent by the department to the Government-appointed review body said the chairs of the two utility firms' boards had written to then minister for housing
Darragh O'Brien
about chief executive pay.
This correspondence was copied to the then minister for public expenditure
Paschal Donohoe
, who had established the committee in March 2024 to advise on pay scales for senior public-sector jobs.
READ MORE
'Attempts to improve the remuneration level have failed', the Department of Housing said in the document.
It said the chief executives of Uisce Éireann and GNI had a base salary that was fixed at €225,000 with no provision for increments or indexation.
[
ESB board had 'significant concern' that €318,000 salary was not sufficient for chief executive post
Opens in new window
]
It said within Uisce Éireann and GNI the senior management teams were entitled to performance-related awards. However, the chief executive was excluded from such payments.
'In Uisce Éireann, there are nine employees in the same band as the CEO (€225,001 to €250,000) and two employees in the final band of €250,001 to €275,000 (ie above the level of remuneration of the CEO). Currently, there are a number of executives in Uisce Éireann whose salaries are capped based on the approved headroom. This presents difficulties for key roles and for succession planning. Two executives left Uisce Éireann over the past 12 months.'
It said in GNI there were also two employees paid more than the chief executive and that two executives had left the company over the previous year.
Mr Doyle said when the chairs had contacted the minister 'in each case the argument has been put forward that the current constraints which exist in respect of pay pose very real and serious risks to the work of these three vitally important commercial State bodies, which are delivering critical infrastructure on behalf of the State and its citizens while, at the same time contributing to the wider economy.'
He said the chairs had set out the challenges of recruiting and retaining high-calibre candidates.
'It is noted, for example, that in some cases the remuneration has remained unchanged at levels approved in early 2017, that the posts are time bound at five or seven years with no opportunity for renewal or for reappointment to any other position within the company, that taking up the position can involve the surrendering of an existing (often permanent) contract to the time-bound contract and the loss of a performance-related award, and finally, that the amount of time it can take an individual to secure employment at the end of time-bound period can, in itself, shorten the length of the actual term served.'
Last month
following the report of the review group,
the Government signalled it would update rules to allow a 'market rate' to be paid to chief executives in commercial State companies.
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