At the cinema the other day, I again saw the expensive advertisement created by Dublin Airport Authority for their new Terminal 2.  You have probably seen it several times.  If not, you can see it on YouTube here.

My reactions were the same as it was the first time I saw it.  Firstly, that it’s smug, self-regarding and creepy.  Secondly, that only a state-owned body with an effective monopoly in its sector could and would produce such an expensive, gold-plated offering.

Thirdly, and the main question that puzzles me: from a business perspective, what’s the point of the advertisement, beyond using up the DAA’s advertising budget for the new terminal?  Are we all going to rush out and book flights through the new terminal on the strength of seeing the ad?  Will it add a single Euro to DAA’s bottom line?  I don’t think so. 

While you are working out this conundrum, have a look at the spoof version of the ad here.  It’s terrific.

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What on earth is causing Fine Gael to hold back on calling for Michael Lowry to resign, or at least condemning him unreservedly?  Or should that be who is causing Fine Gael to hold back on calling for Michael Lowry to resign?  Is it you, Phil?

A letter in today’s Irish Times sums it up nicely:

Madam, – Mr Justice Moriarty described the actions of Deputy Michael Lowry as a “cynical and venal abuse of office”.   All the major parties in the Oireachtas voted for the establishment of the tribunal and now that it has reported, it behoves the Government to take swift action and censure Deputy Lowry in the strongest terms possible. Failure to do so would be political cowardice of the worst kind. – Yours, etc,   NIALL GUBBINS,  Carrigwell,  Carraig na bhFear,  Co Cork.

What possible gain can there be in any hesitation on Fine Gael’s part in this matter?  Lowry has always been more Fianna Fáil than Fine Gael in spirit, and his recent “deal with the devil” during the Cowen regime only confirms that.  I remember hearing about a Lowry-organised fundraiser in the 1990s in the Burlington at which a number of builders and developers of a definite Fianna Fáil bent were seen strutting their stuff.  There was always a whiff of sulphur around Lowry. 

Enda, this will haunt you for years if you get this wrong.  Don’t wait for Leo or Lucinda to push you stumbling in the right direction.  Show some leadership!

 This nugget is too good to do any fact-checking on – I want to pass it on even if should ultimately prove to be exaggerated.  I will do the validation when I get time, or maybe wait for my loyal band of followers (all three of them) to do the spadework for me instead.

One of the results of the barmy and corrupt Bertie Ahern regime is, as we all know, that our senior public sector employees (including our politicians) are ridiculously overpaid compared to their counterparts in any reasonably equivalent country. 

The most egregious and commonly quoted example is that our Taoiseach (even with his recently reduced salary of €200,000) is paid a lot more than the UK Prime Minister (€172,000).  See here for the figures.

But how about this?  I am told that the head of the Irish Navy – more formally known as  The Flag Officer Commanding the Naval Service (FOCNS) – earns more than the head of the US Navy!

What a great little country.  Now if only those bloody foreigners in the Eurozone and elsewhere would charge less interest on all the money they lend us to keep on paying ourselves these highly-deserved salaries.  They have a cheek.  Next thing you know, they’ll be asking Enda and Eamonn and all our other public servants to accept the sort of chickenfeed salaries they seem to be happy with in their under-privileged countries.

I read in the newspaper that the “Nyberg” report  has found that while Anglo-Irish Bank had strong internal risk controls, these controls were ignored as the bank increased its loan book.  I also read that the bank’s non-executive directors (NEDs) have been criticised for relying too heavily on the views of management and for not having sufficient banking experience to question the policies at the bank.

One is entitled to ask why the non-executive directors, who were exceedingly well paid, did not do their job properly and act to protect the interests of shareholders.  Instead they seem to have acquiesced in the most disastrous failure of any management team in the history of Irish business, a failure that has impoverished the whole country.

Perhaps this is the wrong question.  Maybe the question should be: at what point does the level of fees paid to a NED become excessive, to the extent that his/her independence and judgement are compromised by an unwillingness to resign or “rock the boat” and thus lose out on the easy money? 

As far back as 1992, the seminal Cadbury Report on Financial Aspects of Corporate Governance advised that NED fees should “recognise their contribution without undermining their independence”. 

I don’t for a moment question the need for directors’ fees to be sufficient to compensate them for the time and commitment involved (not to mention the potential liabilities).  I subscribe to the view that a NED cannot in good faith be involved on the board of more than a handful of significant companies if he/she is to discharge his/her duties properly. So the fees involved need to be significant.

However, I believe that non-executive directors’ fees in many public companies rose to excessive levels in recent years, and Anglo was a particularly egregious example. Turn, for instance, to page 128 of the 2007 Anglo Annual Report.  You will see that total remuneration for the 7 NEDs who served for the full year was €962,000 – made up of €431,000 for the Chairman (a crazy figure in itself) and an average of €88,500 for 6 others.

Can somebody who is getting such fees be considered independent at all?  To quote Fortune magazine from last year: “High pay for outside directors of corporations guts the whole idea of these representatives of the shareholders making independent judgments. How does a board member challenge a CEO when the director is being paid oversize amounts likely to be important to his or her lifestyle?”

I saw this headline a few days ago. Finally, I thought, some sign of life from the various criminal inquiries related to Irish banking scandals.   At last, we would see a degree of accountability and justice!

Alas, ’twas not to be.  Disappointingly, it was about two UK property tycoons being arrested in London as part of a fraud investigation into a failed Icelandic bank.

Here in Ireland, we struggle to achieve a level of accountability which is taken for granted even in Nigeria.  I don’t care how many enquiries we have under way, or how thorough they are, if they cannot move forward at a reasonable pace then they are simply a waste of time and money, while generating justifiable cynicism.

From the Irish Times a few days ago:

GERMANY’S MOST influential economist has said the Irish economy is “in rude health” and the incoming government should increase income taxes before demanding a cut in interest rates on Ireland’s EU-IMF loans.

Prof Hans-Werner Sinn, head of Munich’s Ifo economic institute, insisted yesterday that Ireland doesn’t need any EU bailout because there was “huge room to manoeuvre” on tax.

The German tax ratio is 40 per cent and the Irish is 29 per cent, 11 percentage points lie in between,” he said. “If you take just three points from the 11 you still have a huge difference to Germany and would have all the money you need.”

He said the Irish desire to renegotiate an interest rate cut was understandable, but that it should not be considered “if Ireland isn’t prepared to increase its taxes”.

“Ireland is a country in rude health, in no way comparable to Greece and I cannot understand any of these insolvency stories, there’s no reason to place Ireland under the rescue shield,” said Prof Sinn, head of the Ifo institute which is behind Germany’s closely watched monthly business confidence index.

His pronouncements on our tax take are rubbish, and I’m surprised not to see the figures being challenged.  It is very important, given the continuing debate as to whether we should place the emphasis on cutting public sector costs or on raising taxes further, that we at least use correct figures when referencing our existing tax burden.

It would appear that Prof Sinn is basing his diatribe on Taxation trends in the European Union, 2010 edition which uses outdated 2008 numbers and, moreover,  bases the comparative ratios on Gross Domestic Product (GDP), not on Gross National Product (GNP).  Ireland’s GDP figure is distorted by multinational profits and their repatriation, and is some 20% higher than our GNP (in most countries the figures are effectively the same).  It is therefore misleading where Ireland is concerned to compare our tax burden based on % of GDP.   

In addition, as anybody who lives in Ireland can tell you, Irish taxes have risen sharply since 2008  and GDP/GNP has fallen significantly.  Therefore, I would be surprised if our tax take wasn’t now higher than the German tax take in percentage of GNP terms.

The other factor which may be at play here (and I would be grateful if some reader would confirm this) is that sometimes elements of PRSI are excluded from reported tax take and netted in our statistics against certain social welfare costs.  This naturally has the effect of understating the tax burden ratio.

I have a horrible feeling that we will see Prof Sinn’s comments regurgitated by the usual suspects (Vincent Browne / Fintan O’Toole / Social Justice Ireland / ICTU etc), not because his pronouncements are accurate, but because they assist a particular agenda.  And if as a result policy is skewed excessively towards higher taxes, or our case for lower EU/IMF interest rates is damaged, we will ultimately all be the poorer.



Great coverage in yesterday’s Irish Times of the General Election results.  Over 12 inside pages, there are stories and statistics from around the constituencies, plus plenty of photographs of successful and unsuccessful candidates at the various count centres.

Now only 15% of the total candidates in the election were women, and the same proportion of the successful candidates were women.

However, the Irish Times seemed to be adhering to a 40% quota rule, as 10 of the 24 candidates it featured in photographs from count centres were women (including all 4 on page 15).   This is nearly three times the number one would expect, if the photographs chosen for publication were selected randomly and accurately reflected the gender divide among candidates.

I’m not complaining about this, as nothing much turns on it.  Just pointing it out.  I suppose that if I were a sub-editor in the Tara Street gynecocracy, I too would be keen to show my awareness of gender issues by including as many photos of our TD sisters as is possible.  The fact that 85% of voters actually choose to elect men is neither here nor there.