Closing Bell: Strikes, a Clerys deal & licence fee controversy

Newstalk's business editor Vincent Wall casts his eye over the week that was...

Closing Bell: Strikes, a Clerys deal & licence fee controversy

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Image of the week for this reviewer was the sight of developer Deirdre Foley sharing a platform with SIPTU organiser Ethel Foley in the timber-panelled splendour of the Mansion House’s Oak Room, and under the watchful gaze of a Charles Stuart Parnell’s portrait.

It was clear the media-shy Foley did not want to be there – she even acknowledged her discomfort – but her presence seemed part of the unrevealed former Clerys workers’ deal with SIPTU, as brokered by Dublin Lord Mayor, Brendan Carr and others.

Though she wasn’t asked, she must also regret now the manner in which the Natrium Joint Venture, of which she is the most visible partner, affected the purchase of the Clerys property, effectively leading to the sudden loss of jobs for hundreds of workers without warning or protection.

Natrium’s plans for the Clerys property look appropriate for a recovering O’Connell Street where trams will soon glide gracefully along the thoroughfare; where investment in the Gresham and other hotel properties should revitalise its northern end; and where hopefully, work will soon commence on a sensitive development of the giant block backing on to Moore Street.

So thankfully, the manner in which the property transferred to Natrium, won’t block this much-needed investment.

But the implications of that cynical June 2015 transaction haven’t evaporated completely for Foley and Natrium, just because of its deal with SIPTU.

In a surprisingly detailed press statement, the Department of Social Protection confirmed it had consulted with the Attorney General about the possible pursuit of Natrium under Section 599 of the Company’s Act, to try to recover some of the more than €2m in taxpayers’ money spent on statutory redundancy payments.

And, of course, the investigation of the Workplace Relations Commission into “who-knew-what-when” aspects of the Natrium deal continues apace.

As in the case of the new Clerys, we await its outcome with interest.

The Donnybrook doldrums

Like Deirdre Foley, in different circumstances, RTÉ Director General, Dee Forbes must now be regretting her comment that the licence fee would still offer value for subscribers, if its price was doubled. 

Good luck with that, in an environment where politicians run scared of introducing any new or increased charge for public services, regardless of their need or merit. Good luck too, when it seems the majority of the listening public thinks RTÉ’s star broadcasters are overpaid and in little danger of being poached by competitors.

Forbes may well have a point about licence fee value when she points out that the cost per day for all RTÉ’s services amounts to about 30c, but of course this doesn’t take into account the advertising revenues the broadcaster also hoovers up, to the understandable chagrin of fully commercial rivals

The relevant minister, Denis Naughten, says he wants to instigate a full review of the objectives, breadth and funding of public service broadcasting and indeed journalism in general.

Expect a few more media organisations to die on their feet before the outcome of that review sees the light of day. Meanwhile RTÉ staff must await more flesh on the bones of redundancy plans and how the proceeds of the sale of part of the Donnybrook campus will be spent.

Finally, nobody wants to see unnecessary pressure placed on employees’ earning potential; like water in a well, we all tend to let our spending habits rise to match our earnings capacity and find it very hard to row back regardless of the circumstances required...

No strikes and you're out

Hopefully, the industrial dispute at Bus Eireann will be resolved speedily for the sake of all stakeholders, particularly customers and taxpayers...

But, perhaps those employees of the company who are taking to the picket lines rather than countenance any reduction in their overall earnings, might reflect on the more than two hundred employees of Ulster Bank who will lose their jobs over the next six months, simply because their employer feels it must cut costs to compete and to reflect changing customer needs.

Ulster’s a more profitable company than Bus Eireann, but threatened or actual industrial action there to prevent the restructuring would cut little slack with the shareholder or customers.

And then there are the employees of companies such as Hewlett Packard in Leixlip and Coty in Nenagh, the loss of whose jobs made recent headlines for a day, but who will suffer the ultimate private sector restructuring penalty.

Shane Ross is right on this one... Keep the taxpayer’s cheque book closed.

Independence Daze

If Charles Stuart Parnell could step out of his Mansion House portrait, his political skills might well be required to resolve the “issues” that have arisen at Independent News & Media (INM).

Apart from all other considerations, it’s ironic that the company – some of whose current principal shareholders levelled suggestions of less than robust corporate governance practices at the previous majority owners and board – now seems beset by a whole new set of high profile governance issues.  

The latest revelations of ongoing reviews by the Office of the Director of Corporate Enforcement and by an internally-commissioned Senior Counsel; and news that the former was triggered by the use of whistleblower legislation on the part of INM’s chief executive, distracted from a solid 2016 financial performance by the group.

The reviews will have to follow their own course and take the appropriate amount of time, but investors should reasonably expect some public resolution of the seeming tensions within INM by the date of its Annual General Meeting at the end of May.