McCarthy report: Main points

Policy context of asset sales

Any programme of asset disposal should be assessed from the standpoint of its contribution to long-term economic recovery. The group cautions against any actions which enhance short-term asset disposal prices at the cost of damage to the economy’s long-run competitiveness.

* Market design and regulatory reform

The Department of Enterprise should become the parent department for all economic regulatory bodies, and should take responsibility for their supervision and performance measurement and for legislative updating.

A comparison should be undertaken of pay and conditions in all commercial state companies with those elsewhere in the Irish labour market and in competitor countries.

* Electricity Supply Board (ESB)

The transmission grid, including the high-voltage system in Northern Ireland, should be transferred to Eirgrid and retained in public ownership as a regulated monopoly.

The ESB should be required to dispose of further generating capacity in Ireland. This should happen regardless of any ESB ownership decision.

The ESB’s energy supply business, electricity distribution business, generation assets (after some divestment), international investment, and consulting and engineering businesses should be sold as a single entity.

* Bord Gáis Éireann

The group recommends that BGÉ’s regulated transmission and interconnector assets should be retained in state ownership. Consideration should be given to the establishment of a distinct state body to own and operate these assets and also to the option of merging these operations into EirGrid.

The group recommends that the remaining operations of BGÉ, other than gas transmission and interconnection, be privatised as a single entity.

* Seaports

The state-owned ports, including Rosslare, should be restructured into several competing multi-port companies, built around Dublin, Cork and Shannon Foynes.

Privatisation of some or all of the ports should be considered, ideally after the recommended restructuring.

* Bord na Móna

The group recommends that the Government should seek to dispose of Bord na Móna as a single entity, including peat extraction rights but not ownership of the peat lands.

* Coillte

The state should initiate the disposal of Coillte’s forest and non-forest assets (but not its forest land).

* State airports and Aer Lingus

The DAA should dispose of its non-core assets, primarily overseas, as a means of substantially reducing its debt exposure. In due course, privatisation of the airports should be considered.

The state’s shares in Aer Lingus should be disposed of as soon as is opportune.

* Irish Aviation Authority

The Government should explore the possibility of merging Irish air navigation operations with NATS (the British air navigation service provider) and possibly other north-west European services. In the event of a merger, the state’s share should be disposed of for the benefit of the Exchequer.

* CIÉ

CIÉ’s tours business, Rosslare port, Expressway and other bus businesses competing directly with private operators should be disposed of.

The group recommends that the privatisation of all or part of Dublin Bus should be considered in due course, but only after government has decided on a model for competition in the Dublin bus market.

* RTÉ and TG4

The portion of the licence fee allocated to the Broadcasting Fund, currently just 7%, should be increased substantially, in order to better equalise conditions of competition between RTÉ and private broadcasters.

RTÉ Transmission Network Ltd should be disposed of as a regulated entity with appropriate safeguards in place to ensure its availability to the state and fitness for purpose in the event of a national emergency.

* An Post and the postal market

The grant of a new seven-year licence to operate the National Lottery should be the subject of an open competition.

The group does not consider that An Post is a ready candidate for asset disposal in the near term. Instead, the focus of management must be on ensuring a sustainable future for the company through cost containment.

* Irish National Stud, Horse Racing Ireland and Bord na gCon

The National Stud should be disposed of.

HRI should dispose of its racecourse interests if commercially satisfactory terms become available.

Bord na gCon should dispose of its interests in greyhound tracks if commercially satisfactory terms become available.

HRI and Bord na gCon should dispose of their Tote interests if commercially satisfactory terms become available.

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