Best of both worlds: Retire early on highest possible pension

WHEN Paul Appleby dropped the unexpected bombshell last January that he was taking early retirement, the Government went into a state of panic.

The Director of Corporate Enforcement who was leading the investigation into the toxic Anglo Irish Bank was leaving before it had completed its work.

The Government was, at the time, commended for how it dealt with the difficulty in a short timeframe, by convincing Mr Appleby to stay on for a further six months, while allowing him to retain his early retirement terms.

On the morning of February 1, he announced his retirement, which he said would not impede the Anglo investigation’s work.

By that evening, after frantic discussions with two Government departments, he had agreed to stay on as acting director, to allow a suitable replacement to be found.

It was no wonder the Government was taken by surprise. The role of Director of Corporate Enforcement was not covered under the generous early retirement scheme offered across the civil service and Mr Appleby would therefore not have been expected to apply for it.

But the long-serving civil servant, whose job it is to forensically examine accounts and complex documents of big companies, knew his own contract contained a mechanism to allow him avail of the scheme.

Under its terms, he would return to the civil service as a principal officer, but keeping the same salary, if his position as Director of Corporate Enforcement ever terminated.

For this reason, he informed the Department of Enterprise Trade and Innovation that on January 16 that he would write to the minister “notifying my intentions to resign from the position as Director of Corporate Enforcement on February 28th next and retire as principal of the department the following day”.

He said: “I will retain my directors’ salary on a personal basis for February 29th and will retire with superannuation benefits based on my director’s salary of €150,712 under the cost-neutral early retirement scheme.”

This allowed him to retire with a lump sum payment of €225,000 and an annual pension of €73,000.

His approach was entirely in keeping with the law and the terms of his contract, and was approved by the Attorney General.

It was also his entitlement to avail of a scheme that was on offer to so many in the civil service, and a spokesperson for the Department of Public Expenditure and Reform said it was merely procedure that he would first resign as director before retiring.

But to many lower-paid civil servants, it would seem unfair that Mr Appleby was allowed the best of both worlds. Returning to principal officer grade allowed him to retire at 58. As director of corporate enforcement he would have to wait until he was 65.

He was also allowed to calculate his pension on his €150,712 director’s salary rather than the €92,672 of a principal officer.

One hint that the Government was not willing to bend over backwards to keep him on was that it turned down his request to have a seven-month period he worked for Ryanair in the late 1980s included in his pension calculations.

After being reappointed as acting director, he will stay on in charge of the Anglo inquiry up until August.

The inquiry is still unlikely to have concluded by then, and he will have to hand the task over to somebody else when he departs with a golden handshake and gold-plated pension.