We could learn from the ills of privatisation in the United Kingdom, which had created fat cats, bad service and discontented employees, the Minister for Public Enterprise, Ms O'Rourke, told the House in the debate on the Bill to facilitate an initial offering of shares in Telecom Eireann.
"The value to the United Kingdom was not what it could have been had it been approached in a more careful manner," she added.
Earlier, Mr Shane Ross (Ind) had insisted that no over-generous share options should be given to the management. One of the great financial scandals which had spoiled privatisations in Britain was that outrageous options and rewards had been given to people who had done absolutely nothing to deserve them.
If the Minister wanted this privatisation to go smoothly after its initial launch, she should give no options whatever to the management in the initial phases of this flotation - in the first year or two - so that there was no sour taste in the mouth.
Criticising the allocation of 14.99 per cent of the shares to the workforce, Mr Ross said this was the most generous package he had seen in commercial or political life. The workers in Telecom should not be paid for agreeing to give up their bad practices.
Supporting the Minister's strong defence of the allocation to workers, Mr Liam Fitzgerald (FF) said it was curious that the employee share scheme had received such a bashing in the media. Strangely, KPN and Telia, which had got the bargain of the century through their involvement with Telecom, had escaped this media wrath. But the Telecom staff, who had put so much into the company, had been targeted for venom and be-grudgery.
Mr Jim Walsh (FF) expressed concern at reports that Telia might not continue to be part of the current arrangement along with KPN. There was a suggestion that KPN might acquire the full shareholding. Any decision in this regard should be examined very closely, to ensure that any development in this area would not inhibit the future development of Telecom.
Mr Fergus O'Dowd (FG) said a significant proportion of the funds raised through the flotation should be made available to the Department of Public Enterprise for transportational and other infrastructural improvements.
Mr Feargal Quinn (Ind) said he saw no reason for the State to carry in the long-term a very sizeable equity investment in Telecom Eireann. "The plan should be to cash in its stake and to put the proceeds to good use elsewhere. Now that the structural funds from Europe are beginning to dry up, the State will need to put very large amounts of development capital into the economy over the coming decade."
Mr Paschal Mooney said the Minister would be the political master of a Department and a process which he hoped would generate £2 billion.
Responding to the debate, Ms O'Rourke said she was determined that there should be an equal participation by the Irish people in the process. The necessary forms would be available in post offices throughout the State.
The Bill passed the second stage.