THE Electricity Supply Board now has no chief executive after the board decided not to go ahead with the appointment of Mr Ken O'Hara as the new chief executive because of a dispute with the Government over Mr O'Hara's remuneration package.Mr O'Hara was due to take over as chief executive from Mr Joe Moran today. However, after a six-hour emergency board meeting on Saturday, the chairman of the ESB, Mr Billy McCann, wrote to the Minister for Public Enterprise, Ms Mary O'Rourke stating that it could not go ahead with Mr O'Hara's appointment because of the Government's insistence that the new chief executive's remuneration should be based on the Gleeson salary guidelines.

The Gleeson guidelines provide for a remuneration package for the ESB chief executive of up to £105,000 when various performance and incentive payments are included. But the ESB negotiated a more lucrative package with Mr O'Hara, based largely on the Buckley report which recommended that a more flexible approach be taken when appointing and remunerating semi-state chief executives.

On this basis, it is understood that the ESB negotiated a package that would have paid Mr O'Hara over £150,000 when the various elements of the package are taken into account. Sources close to the board said that the Government had been made aware from the outset that the ESB had made the Government aware that it was negotiating a "competitive" remuneration with Mr O'Hara on the basis of what the source described as "a Buckley-type contract".

However, at its first cabinet meeting last July, the Government took a decision to postpone the implementation of the Buckley report, a decision seen as reflecting the Government's clear wish not to take any action that would undermine the Partnership 2000 deal with the trade unions.

The Minister for Public Enterprise, Ms O'Rourke, told The Irish Times yesterday that she had reiterated the Government's decision to suspend the implementation of the Buckley report last week when she met the board's chairman, Mr McCann and another ESB director, Ms Caitriona Murphy. "They advised me of their difficulties on the appointment of the chief executive, but I told them that they Government decision stood."

The Minister said the Government's decision was not specific to the ESB and its new chief executive and emphasised that it had also nothing to do with the fact Mr O'Hara was chosen from within the ESB and not recruited from the private sector.

She added that the appointment of new chief executives to Aer Rianta and the Irish National Petroleum Corporation, which fall vacant in the next few months, will also be made on the basis of the Gleeson salary guidelines. "The Cabinet took the decision in July to suspend Buckley sine die, and that policy still stands," she stated.

As things stand, the ESB board and the Minister are involved in a stand-off, and sources said it is difficult to see where common ground can be reached. "Given the importance of Partnership 2000, the Government can't be seen to concede, given their decision on Buckley," said one source.

There is speculation that the board may try to persuade the Minister and the Department of Finance to accept a personal contract for Mr O'Hara, on the lines of the personal contract agreed with the Aer Lingus chief executive, Mr Gary McGann, and the Telecom Eireann chief executive, Mr Alfie Kane. Mr McGann and Mr Kane are thought to be on personal contracts which pay them in the order of £200,000 a year.

But it is also clear that the ESB board is angry at the way the Government has addressed the salary of the board's new chief executive.

According to one source close to the board, the decision last January to publicly advertise the chief executive position with a "competitive remuneration" package attached had been done with the agreement of the then Department of Energy.

He added that Mr O'Hara had been selected unanimously after the entire ESB board had interviewed a short list of candidates. "The Minister was informed on the selection and the basis of the remuneration package, the Buckley report." In late July, however, the board was informed that the implementation of Buckley had been indefinitely suspended.