An ill wind blowing for the Irish taxpayer

Why is it State sector bodies have a beginning, and maybe a middle, but no end?

Some of us might remember in school being force-fed that essays, among other things, had to have a beginning, a middle, and an end. The same could be said of organisations and businesses, unless the shareholders decide to migrate it to another sector and, thus, create another life for it.

In doing so, it would, of course, have to invest its resources and take risks, but presumably its shareholders would be either aware of the risksor, at least, that there were risks it could lose its capital investment.

That companies or organisations should have a defined lifespan should come as no surprise.

As time moves on, people change, needs change, technology moves on and different, better opportunities exist for us to spend our hard-earned cash. If we look back over the last 20 years, we can, with some difficulty, summon what were, for a short while, names that tripped off our tongues, but are no longer to be seen or heard of.

When was the last time you saw an IBM computer? Whatever happened to Gateway? Even Bewleys is becoming just a memory. However, the State sector seems to have a life of its own that makes it think it can go on forever.

I was intrigued to read that Nama had advised Government that redundancy costs would only amount to around €20m.

Nama was set up a wet week ago with the sole purpose of sorting out the State finances following the collapse of the economy, presided over by the State itself. A major intent of this new organisation was that it would help the banks to get out of the hole they dug for themselves and allow them to extend credit to the business community, particularly the small business sector, to get the economy moving again.

Did it succeed in that task? The jury is out, and it will take some deliberation.

The bottom line was that Nama was set up for a specific purpose, and should not have been hiring employees on anything other than time-based contracts. It would appear somehow, it decided it would have a life beyond its brief. Mind you, given the salaries being paid, it’s no wonder its senior folk thought that might be a good idea. If it were just Nama that appears to have these illusions it would be one thing, but it’s widespread.

Last Sunday I was reading of the efforts of other semi-states to prolong their lives by moving into other industrial sectors. Bog owner and peat briquette owner Bord Na Móna, state forestry owner Coillte, and ESB, have spent zillions on building windfarms. They didn’t do this together, but in competition with each other. Dah! One can sort of understand ESB getting into other means of generation — but the other two?

Bord Gáis Energy built up a huge windfarm portfolio before it was sold last year, but who can explain the logic of other semi-states building windfarms, while the Government is unloading them on the other side? Worse still, at the same time, the Government —through the national pension reserve fund/ISIF — is investing in windfarms.

Building windfarms is not cheap and it’s not easy. Locals take exception to having these noisy contraptions outside their front doors. Why are they doing it? Indeed, who gave them permission to do it?

The Department of Energy has apparently advised that these companies make their own operational decisions on an independent basis. Now, that really fills me with confidence.

Industries heading for the end of their mandates are spending money on ensuring their employees’ jobs can go on forever. Is that what they were set up for?

According to Colm McCarthy, it’s the subsidies to the alternative energy sector, paid for by us consumers in our electricity bills, rather than any real demand that are prompting these redundancy-hit State companies to turn to wind energy.

The next one coming down the line will probably be the employees of these companies seeking, and being granted, better terms because of the changing nature of their jobs. The merry-go-around just keeps going around and if you are not on it, tough.

Paul Mills