Ciaran Hancock, Finance Correspondent

Members of the Irish Bank Officials Association have threatened to take industrial action if the Government proceeds to implement cuts of 6 to 10 per cent in the remuneration of staff at AIB, Bank of Ireland and Permanent TSB as recommended recently in a report by consultants Mercer.

Each of the banks is expected to submit their plans to achieve these cuts in the next couple of weeks.

IBOA general secretary Larry Broderick also called for a Leveson-style inquiry into the collapse of the Irish banking sector. Mr Broderick said a senior High Court judge should lead the inquiry with powers to subpoena witnesses, including current and former bank executives, and representatives from the financial regulator, auditors and law firms.

“It’s an absolute disgrace that people who have destroyed this industry are now out playing golf, watching GAA matches and going to see Ireland abroad, drawing on big healthy pensions while this country is in absolute freefall,” Mr Broderick said. The reality is this: we need a Leveson-type inquiry, with a high-ranking judge to evaluate and identify how the industry was ruined.”

Delegates at the union’s biennial conference in Croke Park unanimously supported an emergency motion tabled by its executive urging that the cuts in the Mercer report be resisted.

Mr Broderick slammed Minister for Finance Michael Noonan for not consulting with the union when the Mercer report was being prepared.

”It is absolutely disgraceful in the week that is in it, that the same Minister that calls for a 6 to 10 per cent pay cut in our industry sits silent at the AGM of Bank of Ireland and does not stop excessive salary increases for chief executives in our industry, Mr. Broderick said.

This was a reference to the storm during the week about the pay of Bank of Ireland chief executive Richie Boucher, whose remuneration was €843,000 in 2012 and whose salary is above the Government pay cap for bank executives. Many shareholders vented their anger at the bank's AGM this week at the pay awarded to Mr Boucher and other members of the board.

Bank of Ireland declined to comment on whether Mr Boucher would have his remuneration reduced as part of its plan to satisfy the Government’s direction on reducing its overall remuneration by 6 to10 per cent.

A spokesman for the Department of Finance reiterated that it was up to the individual banks to frame their own plans to meet the Minister’s direction on reducing their payrolls.

In the Dáil this week, Taoiseach Enda Kenny said he expected senior bankers to make a “substantial contribution” to reducing the cost of their pay and pensions. Yesterday, he said the banks’ reports on the matter should be submitted to the Minister for Finance within the next fortnight.

“ I hope that it’s of the higher order,” he said at the launch of the Government’s latest report on its jobs action plan.

It is understood that Mr Noonan and the department have not directly asked Mr Boucher to take a reduction in his current remuneration.

Mr Broderick added that the average pay of bank officials was €45,000 and they had taken “enough pain”.

He said staff at Irish Bank Resolution Corporation, which was places into liquidation by the State in early February, had received "outrageous treatment" from the Government as a result of being told that they would receive only statutory redundancy terms when they leave the bank later this year.

We call on the Government to honour the commitment to those staff...to have a voluntary severance agreement put in place and we call for that to be done now.”

Mr Broderick warned that a similar fate could befall staff in other Irish banks unless the union took a stand on the treatment of IBRC workers.

Mr Broderick welcomed AIB’s decision to refer issues relating to pay, pensions and job security to the Labour Court, which is expected to deal with this in the coming weeks.

“This is a welcome development . . .and a positive way forward.”

He also told members that Ulster Bank had “backed off” on compulsory redundancies as part of its process to reduce its head count by 950.