Revealed: Row over €56k bonus at Coillte
The state forestry body decided to sign over the money to chief executive David Gunning at the beginning of this year. In doing so it ended an unseemly two-year row with the Department of Agriculture over this deferred 2008 award.
More recently, the board agreed to pay Mr Gunning a further bonus for his work in 2010, which would have entitled him to a lift of up to €74,000, but he declined to take it.
The initial decision to release the withheld 2008 award was made after a remuneration committee meeting in December 2010.
The convening of this committee further angered the then agriculture minister Brendan Smith as no representative from the department was invited to attend.
Mr Smith told Coillte he was “astonished” at its conduct and claimed its board was fully aware that if a departmental official was present an attempt would have made to block the payment.
“At a time when it has proven necessary to impose cuts in wages and social welfare allowances and to increase taxes at all levels it seems inconceivable that a bonus could be paid to a person earning in excess of €400,000 a year,” Mr Smith told Coillte chairman Brendan McKenna in a letter.
He was referring to Mr Gunning’s €295,000 salary, his €100,000-a-year pension scheme, €2,000-a -month car allowance and a €7,500 company-sponsored health insurance package.
However, at another remuneration meeting held the day after Mr Smith sent his letter, Mr McKenna said it was “not his job to take into account populist views” and there was “a clear obligation” on the board to give Mr Gunning the bonus he was due.
Mr McKenna said the board acted legally, professionally and ethically. At the same meeting another director, Yvonne Scannell, said not only would it be illegal to keep Mr Gunning’s bonus but “it would be immoral not to pay”.
In response to her, the department’s assistant secretary general, Kevin Smyth, said “the terms morality and indeed obscenity would be used when the public finds that bonuses are being paid… in a time of stringent austerity”.
Details of the hostility between the commercial semi-state company and its sponsoring department were revealed in frank correspondence — some of which is reproduced here — released under the Freedom of Information Act. This showed the payment was made before the fall of the last government and ahead of similar standoffs between ministers and both the Dublin Airport Authority and Horse Racing Ireland.
In the case of HRI the new Agriculture Minister Simon Coveney successfully demanded its chief executive Brian Kavanagh return the deferred bonus which was released to him this year.
Regarding Coillte, Mr Coveney was asked if he agreed with the position and comments of his predecessor. He said: “I don’t think it’s appropriate for me to comment on a previous minister’s statement.”
A department statement praised Coillte for turning its business around and being in a position to pay a €10 million dividend back to the state last month.
It noted that Mr Gunning had not accepted a bonus available to him for 2010.
Similarly, Coillte said Mr Gunning had decided not to accept the offer from the board this year.
“The board decided to pay it in 2010 given the significant improvement in the performance of the business in 2010 and its contractual obligations to the chief executive,” a spokesman said.
“In respect of 2010, the CEO informed the chairman in June this year of his intention not to accept a performance-related payment for 2010.”
CONNECT WITH US TODAY
Be the first to know the latest news and updates
