Oireachtas

Employees to be offered 14.9% shares in Telecom

The Government has agreed "in principle" to the sale of 14

Thu Oct 02 1997 - 01:00

The Government has agreed "in principle" to the sale of 14.9 per cent of shares in Telecom Eireann to its employees at a "fair price". The Minister for Public Enterprise, Ms O'Rourke, told the Dail that the Government has "no ideological difficulty with that concept", and that the framework for negotiations on the sale had been agreed.

Replying to a question from Mr Pat Rabbitte (DL, Dublin South-West) Ms O'Rourke said: "I am clear in my mind and the Government is clear that we can do satisfactory business with the representatives of the employees in Telecom."

Pressed by Mr Rabbitte as to what was a "fair price", the Minister replied: "The fair price is now the subject of evaluation and I understand that both Telecom and the unions and ourselves are going to engage separately in an evaluation exercise."

Asked if she has the agreement of the strategic partners, and of the board of Telecom, that the shareholding would rise from 5 per cent to 14.9 per cent, she said they were aware of the Government's commitment in the Programme for Government.

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Mr Rabbitte wanted to know when was she going to decide on the disposal of shares, because the workers "have been led to believe that this will be in their Christmas stockings."

Ms O'Rourke said she would proceed with negotiations in a very studied way. "It would be inappropriate for me to go into the deliberations in my mind but not yet talked through with other people.

"The details of any scheme are a matter for negotiation between the parties. From the outset for the strategic alliance process, a shareholding of up to 5 per cent was earmarked for the employees of Telecom Eireann in return for verified cost reductions and change within the company."

Mr Emmet Stagg (Lab, Kildare North) said the Minister's position was at variance with her party's stated view in opposition, when it said that 14.9 per cent of shares should be made available to workers "free, gratis and for nothing."

There was certainly no question of market value being sought for the shares.

Ms O'Rourke rejected this. She said that Mr Ahern and the Progressive Democrats leader, Ms Mary Harney, had stated in a letter that the shares should be sold "at a fair price."

The Government was open to practical proposals to purchase shares for cash payment to the Exchequer, "when it is satisfied that this will assist the future development of the company."