This week the Government has agreed to implement most of the recommendations made by the Senior Posts Remuneration Committee after it examined the pay arrangements for bosses of commercial State bodies – better known as semi-States.
The decision paves the way for updating rules to allow payment of a “market rate” – and possibly, pay reviews and increases – for semi-State chief executives.
Almost 30 commercial State bodies fall into the scope of the review including utilities and transport companies. Among their number are the likes of An Post, the ESB, Uisce Éireann, DAA – the operators of Dublin and Cork airports – and RTÉ.
Will there be a teacher’s strike in the autumn?
The bosses of such organisations have significant remuneration packages including basic salaries, pension payments and, in many cases, other allowances or benefits.
Could Shedeur Sanders ever really be another Tom Brady after phone faux pas and NFL draft snub?
Masseur admits to sexually assaulting woman during massage at Co Cork hotel
Michael Gaine: Why did gardaí upgrade this case and what are they hoping to find?
How a housing ‘tsar’ in waiting became a PR problem for the Government
An Post chief executive David McRedmond’s total remuneration came to €318,000 in 2023.
ESB chief executive Paddy Hayes had a total remuneration package of €372,946 last year.
Uisce Éireann chief executive Niall Gleeson had a total package of €276,000 in 2023.
DAA boss Kenny Jacobs’s overall remuneration came to €347,457 in the same year.
RTÉ director general Kevin Bakhurst’s remuneration package is €337,500 – though a pay review or increase would seem unlikely given the financial support for the broadcaster and the opening of a voluntary redundancy scheme.
However, while on the face of it commercial State body bosses are well paid, the committee found that chief executive remuneration packages have fallen out of alignment with the market and there are concerns this could affect recruitment if qualified candidates are significantly better paid in the private sector.
The committee report says an external benchmarking exercise established that the base chief executive salary of commercial State bodies is equivalent to 68 per cent of the market median.
There is said to be “a requirement for a transparent and robust framework for the regular review of CEO [chief executive] remuneration to ensure that CEO remuneration levels are set and remain at a level that is appropriate and equitable, recognises and rewards performance, and attracts the best prospective candidates into the future”.
The committee’s report made 17 recommendations.
It said a process should be established to gauge the level of pay within each organisation and compare it to corresponding remuneration levels for private sector enterprises operating in the same sector.
The roles should be assessed in terms of the complexity and size of the organisations, according to a prescribed formula.
The report says the results of the company-sizing assessment “should then be compared to a suitable cross-section of CEO roles from the private-sector market in order to establish appropriate salary benchmarks”.
This market sample “should rely in the main on general industry in Ireland, but account should be taken also of appropriate international comparators as a contextualising consideration”.
The report said individual boards and remuneration committees should decide on the appropriate scale for the chief executive of that commercial State body, with the ceiling being 120 per cent of the market median salary.
Approval will still be required from the Government for salary increases.
The Coalition did not approve recommendations that there be a backdating of any pay increases and the reintroduction of pay-related bonuses.
The report outlined its understanding that as current contracts conclude, a significant number of vacancies for chief executive posts in commercial State bodies will need to be filled over the next 18 months.
With vacancies arising, the new regime for reviewing and increasing the pay on offer for bosses of commercial State bodies may well be road-tested soon.
