Gilmore claims it’s too little, too late

LABOUR leader Eamon Gilmore has questioned whether the Government’s efforts to block AIB staff receiving €40 million in bonuses will succeed.

Legislation being introduced by Government today will seek to close off any hope that AIB staff have of receiving the controversial bonuses.

Finance Minister Brian Lenihan has inserted into a wider bank restructuring bill a provision which allows him to impose “certain conditions” on an institution in return for state support.

He has told AIB not to pay the bonuses if it wants further funding.

But Mr Gilmore said the Government had left it far too late in the day and was now implementing a proposed solution that could ultimately prove flawed.

He pointed to the successful proceedings brought by AIB trader John Foy, who won the right to his €161,000 bonus last month after the bank failed to contest the case.

Another 90 of the total of 1,460 employees entitled to the bonuses also initiated legal actions.

Mr Gilmore queried whether Mr Lenihan’s legislative proposals would block payment of those 90 bonuses should court orders also arise in those cases. “My advice is that, according to the Buckley case in 1950, the Oireachtas or the Executive cannot intervene or supervene — the word now being used by the minister — in a case which has already commenced. If that is the case, while the minister has sent his letter, bonuses will still have to be paid… Are we in a situation where the minister is shutting the door after the bonuses have bolted?”

In response, the Taoiseach said the conditions that Mr Lenihan had now imposed on AIB “provided a legal basis upon which the bonuses may not be paid, or would not be paid”.

“Whereas the judgment in the case of Mr Foy is a matter of court order and has to be paid, my understanding is that the other cases which are in process have not yet been paid. It is important for us to deal with this matter as expeditiously as possible, therefore, to provide as much legal justification as possible for the decision we are seeking to have effected, which is that these payments will not be made.”