High public pensions to be targeted in budget

THE Government has said plans to end extra-high pension payments for senior civil servants should feature in the budget following angry reactions to data showing that the former secretary to the Government was paid more than €570,000 on retirement.

Dermot McCarthy received a special severance payment of €142,670.50, in addition to a lump sum of €428,011.50, when he left the civil service during the summer.

Figures released to RTÉ under Freedom of Information (FoI) act show that the retired senior civil servant’s annual pension is €142,670.50.

Mr McCarthy was appointed secretary general to the Government in 2000 and was also secretary general to the Department of the Taoiseach. He was a key player in a number of initiatives during more than a decade in the position, including being a major figure in the finalisation of various social partnership deals.

But Sinn Féin’s public expenditure and reform spokeswoman, Mary Lou McDonald, described his lump sum payments and pension pot as completely inappropriate and scandalously high. The Dublin Central TD said it is another example of inappropriate pay levels enjoyed by the highest-ranking civil servants.

“This Government, like Fianna Fáil before them, continues to support scandalously high salaries for senior civil and public servants,” Ms McDonald said.

“Contrast Dermot McCarthy’s €428,000 lump sum payoff, plus €142,000 special severance package and annual pension of €142,000, to the recruitment embargo on desperately needed special needs assistants, gardaí, social and healthcare workers, and we can see exactly where this government’s priorities lie,” she said.

But a spokesman last night said the Government was committed to ending the exceptionally generous pension regime for those at the top of the public and private sectors:

“While it is not possible to change existing arrangements, the Programme for Government commits to capping taxpayer subsidies for all future pension schemes at €60,000 per annum. These reforms are complex but are being advanced and will be ready by the budget,” he said.

The pensions section of the Department of Public Expenditure and Reform, which released the information, said Mr McCarthy’s pension was based on his salary of €285,341 before the public service pay cut that took effect in January 2010. It is also based on 40 years of service, including 67 days of additional notional service, and an annual reduction of €13,980.49 is applied under the public service pension levy.

The department said that the severance and pension arrangements that applied to Mr McCarthy were put in place in 1987.

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