The Government has approved the controversial appointment of Robert Watt as full time top official at the Department of Health, but he will waive the €81,000 pay increase "for the time being".
Mr Watt will not receive the proposed €292,000 a year salary but will remain on the €211,000 he has been on in his previous role as Secretary General at the Department of Public Expenditure and Reform.
Ministers were not given the normal prior notice of the appointment and the pause in the pay increase "for the time being" has been described by some as "loose and vague".
At its weekly Cabinet meeting, the Government proceeded with the appointment following an international search and a recommendation from the Top Level Appointments Committee (TLAC).
Mr Watt's proposed appointment was due last week but was delayed amid ongoing controversy.
Both the Dàil's Public Accounts Committee and Finance Committee had called for the process to be suspended as they queried the basis for the pay increase.
Mr Watt was already a top tier Secretary General but the Government have defended the large increase given the complexity of the job.
Mr Watt will serve a five year term.
Robert Watt said: “I was delighted to be asked to take on the role of Interim Secretary General in the Department of Health earlier this year. An open TLAC competition was held and I am pleased to be asked to take on this role on a permanent basis following the Government meeting today.
“The proposed salary for this role is higher than my current salary. I don’t think it is appropriate to take such an increase in pay given the current difficult economic conditions the country faces.
"It had always been my intention that, if I were to be appointed to this role, I would waive this increase until the economy begins to recover and unemployment falls.
“I am looking forward to continuing to work with my colleagues in the Department of Health on the many challenges we face.”
The Health Minister said Mr Watt brings a wealth of experience to the role.
Stephen Donnelly welcomed the appointment saying: "The Department continues to work through the challenge of Covid-19, is leading on the vaccination programme and the implementation of Sláintecare.
"Robert brings a wealth of experience to this role and I looking forward to working with him in the time ahead."
Social Democrats co-leader Catherine Murphy said Mr Watt's future wage will set a precedent.
"There's no way that this is not going to have a knock on consequence, I think we're going to go into a very difficult environment and following Covid, hopefully we'll be at a point where we will start to recovery and I think it signals for other secretary generals in terms of pay scales.
"It has all the hallmarks marks of the thinking of the Celtic Tiger era where we were constantly told in a really crude way, 'if you pay peanuts you get monkeys'.
"The reality of it is that if you look at the comparisons between for example, the CEO of the HSE, and the head of the Department of Health, you will you will see that if you look at the comparison with the UK, in actual fact the pay rates there are lower and substantially lower than what is already provided for here."
She added the salary for the new secretary general was "an absolute fortune".