Plan to sell minority stakes in state assets to be agreed

PLANS to sell minority stakes in strategic state companies including the ESB and Bord Gáis are likely to be agreed in the autumn, as part of a compromise between Fine Gael and Labour on the issue.

The Government has strengthened its commitment to dispose of assets as part of a plan that would raise €2 billion for investing in water, broadband and other infrastructure projects.

A revised memorandum of understanding between the Government and the troika of the EU, ECB and IMF said the Government would consider an “ambitious programme of asset disposal” by December.

The agreement, published on Friday, is more forthright than the previous agreement which said the Government would “consider a potential programme for asset disposal.”

Prior to the election Fine Gael was in favour of selling ESB and Bord Gáis, while Labour was strongly opposed to the idea.

The Programme for Government contained a commitment to sell “non-strategic state assets” to finance infrastructure investment.

But disagreement has emerged over what was strategic and what was not.

It has been reported that the compromise reached is to sell just a minority stake in significant companies.

Details of any new plan are yet to be finalised and will have to get the approval of the bailout team.

Any planned sale is likely to arouse the opposition of the trade unions, which are especially strong in companies like the ESB.

A review group headed by economist Colm McCarthy last April recommended a planned programme of asset sales to reduce the state’s high level of indebtedness.

It outlined a menu of €5bn of assets that could be sold. But it warned against a rushed sale process, as this would “inhibit attainment of value and, in many cases, would not be prudent or even possible given the requirement for revised regulatory procedures and complex legislation”.