€200,000 pay cap stifled hiring of finance chief

The search for a new head of the Department of Finance was frustrated by a salary cap and saw several candidates apply for the position with salaries well over the amount offered.

A pay cap of €200,000 for the position was an “obstacle” to finding an appropriate candidate.

Finance Minister Michael Noonan was told of problems in searching for a new department chief but also of how EU and IMF lenders were pleased that the hunt for candidates reached outside Ireland.

Documents obtained by the Irish Examiner show the initial quest to find a new secretary general at the department ran into trouble.

The minister said urgent action needed to be taken to fill the position after it “had not been possible to attract a stronger field of candidates” even after a panel had reviewed 19 applications.

The alert was raised with Mr Noonan by the top-level appointment committee, which then hired an outside firm to help it hire an appropriate candidate. A further search was attempted with the help of headhunting consultants Merc Partners. The finance post was finally given on Mar 6 to John Moran — already working in the department as its banking unit head.

A follow-up letter from Merc to the committee, released under freedom of information laws, noted how the salary cap had frustrated the search for candidates. Managing partner Barry O’Connor told the committee: “While the €200,000 ceiling on remuneration was an obstacle, there are always several reasons why candidates will not proceed with opportunities. Four of the six candidates presented had remuneration packages well in excess of that on offer and were still interested in progressing the matter.”

After taking office, the Government announced public sector pay caps, including €200,000 for future senior appointments in the public sector, including secretaries general.