19 July 2001 Edition

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ESB prepares for privatisation

BY ROISIN DE ROSA ([email protected])

Last week, ESB workers voted to accept a deal which offers pay increases amounting to up to 21% in exchange for accepting restructuring proposals, including 2,000 redundancies. They had little choice. According to one ESB worker, employees were told the redundancies would happen anyway, but if they wanted the `rewards' they would need to vote through the package. They did.

The package, known as PACT, the Programme to Achieve Competitiveness and Transformation, has been negotiated over the past 18 months and involves some 70 separate agreements. The overall deal includes final agreement to the Employee Share Ownership Plan (ESOP), which will give full time workers a 5% share of the company upon deregulation.

The agreed deal will affect every aspect of the economy. Consumers and industry alike rely on power. The deal crucially allows for the use of contractors in the massive investment programme of £2.1 billion planned by the ESB plans to upgrade the electricity network across the country. Government is happy to shuffle off the responsibility here to the private sector and substitute contractors with their built in ``flexibility'' in place of strongly unionised workers.

The deal also brings the separation of retail ESB from the accounting billing section, with many local ESB retail outlets facing closure. ``Is this going to mean consumers can no longer buy their white goods on preferential credit terms through the ESB?'' asks Wexford councillor John Dwyer. ``Will the many people in the low wage bracket, who would never get credit for consumer goods, now have to go without?

``Nobody knows what shops are going to close, but one thing we do know, the friendly face in the local ESB shop will be phased out as soon as possible in favour of `Third Party Receipting'. Payments will be made through the banks, with ``a little charge'' to the banker on every transaction.

``Bobby Molloy tried to bring this system in a decade ago, but he was beaten by public opinion and the social partners, who didn't want to see phasing out of ESB shops or control of supply of electricity in the impersonal hands of private, profit making companies.''

The ESOP deal amounts to what the company calls a ``nest egg'', which on present value amounts to a ``gift'' of £8,000 per person, which cannot be cashed in until 2005. ESB management believes the value of this workers' ``nest egg'' will increase well beyond this if their expansion plans in the Basque country and in Poland are successfully implemented. The government put a spanner in the ESB's plans for the Polish investment last month, directing the company to concentrate on building the urgently required network in this country before they ventured abroad into the Polish market to supply a £1 billion investment package.

The deal puts into stark perspective the recent battles fought in the public sector with the teachers and before that the nurses. There were no ``nest eggs'', comparable pay increases, or immediate sweeteners on offer to workers who provide these crucial social services - health and education.

The agenda speaks for itself. It's the privatisation agenda set by the EU, so eagerly grasped by the Fianna Fáil/PD coalition, so greedily anxious to curtail the provision of essential services, break union powers across the board, to promote competition and profit.

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