Bord na Móna paying tax bill for chief’s €127,000 electric BMW ‘is unacceptable’

Payments from Bord na Móna to cover the benefit-in-kind tax bill for its chief executive’s electric BMW and health insurance at a cost of €64,000 have been criticised as “unacceptable”.

The remuneration package of the chief executive of the semi-State body, Tom Donnellan, has come under scrutiny following a series of parliamentary questions from Fine Gael TD Fergus O’Dowd.

As part of his role the chief executive has the use of a leased company car, an electric BMW iX Sport 5-door SUV, worth €127,000. The car has €14,000 of factory extras included – such as metallic paint and a comfort plus pack worth €5,170.

The semi-State company paid Mr Donnellan a salary of €225,000 last year, as well as a further €56,000 in pension contributions and €64,000 in “taxable benefits”, according to its 2022 annual report.

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A breakdown of the taxable benefits figure included payments of €46,000 related to benefit-in-kind associated with the company car, and €18,000 to cover benefit-in-kind costs related to his health insurance.

The breakdown was released to Mr O’Dowd in response to a series of parliamentary questions.

Speaking on RTÉ radio’s Morning Ireland, Mr O’Dowd, said both the cost of the company car and covering of the benefit-in-kind were unacceptable.

The Louth TD said “ordinary Joe soaps” would be shocked that a chief executive’s bill for benefit-in-kind, a tax liability arising from the vehicle being provided, would be covered by a semi-State company, he said.

In a statement, Bord na Móna said its executives’ remuneration was fully disclosed in its annual reports.

“As an executive director, the CEO’s salary, pension contributions and all taxable benefits are also disclosed in full and in accordance with the relevant accounting standards and with the guidelines for semi-state companies,” it said.

“All payments made to our CEO and any benefits received by him are fully taxed in line with relevant tax legislation,” it said.

It said Mr Donnellan’s remuneration package was set by a board sub-committee and subject to the approval of Minister for the Environment Eamon Ryan.

Mr O’Dowd said there should be stricter limits around spending on company cars at semi-State bodies.

“There should be a maximum ceiling of €60,000 set by the Government for car purchase for any semi-State CEO and if they wish for a higher spec they should pay it themselves,” he said.

“It’s unacceptable that amount of money being spent on a car. It is absolutely unacceptable. It’s not good value for money. It’s an appalling situation that money is being wasted on a car of that cost. I don’t see why Bord na Móna don’t actually pay the chief executive officer that amount of money in his pay,” he said.

“I know many people who drive a company car and they’re telling me that after the last budget they were having great difficulty to pay their BIK [benefit-in-kind].

“My own friend’s BIK [benefit in kind] went from €60 to €100 per week for his company car, and that was on top of increased mortgage payments and having a young family. So the ordinary Joe soap out there, he’s finding it very difficult to pay his BIK. I think it’s a huge issue,” said Mr O’Dowd.

Trade union Siptu called on Bord na Móna to clarify how many other senior managers enjoyed similar benefits.

“The largesse that Bord na Móna demonstrates towards its senior management contrasts sharply with its miserly approach to workers in recent years,” said the union’s divisional organiser Adrian Kane.

“When it comes to the just transition and climate change, management’s policy appears to be six-figure electric cars for CEOs but unemployment for workers in Derrinlough [the site of a briquette factory that closed in June].

“In the midst of a cost-of-living crisis, that arrogance and hypocrisy will be difficult for our members to stomach. As a publicly-supported body, it is vital that Bord na Móna comes forward and clarifies whether other individuals in senior management are in receipt of similar lavish arrangements.”