Fine Gael has now been in power since March 9, 2011, and just three of its 10 ministers appointed to the Cabinet that day remain at the table — Taoiseach Leo Varadkar, Tánaiste Simon Coveney, and newly appointed Communications Minister Richard Bruton.
As a result of their years of service to the public, they are entitled to a generous set of retirement benefits whenever they choose to bow out of political life, writes
A TD’s salary is €93,599, so to calculate that TD’s pension entitlement, one divides the salary by 40 and multiply it by 20, which means the TD is entitled to a €46,799 a year pension once they reach retirement age.
Retiring TDs are also entitled to a one-off pension lump sum of three times their pension. So, in this example, the TD would receive three times €46,799 — a lump sum of €140,398.
On top of this, TDs who have served more than six months in Dáil Éireann are also entitled to a termination lump sum equal to two months’ salary (€15,599).
If TDs have served for longer than three years they are also entitled to up to 12 monthly payments based on their length of service (for a TD the maximum payment total over 12 months is €57,920). Only after these payments end do they receive their pension proper.
Mr Bruton, a veteran TD of 36 years’ service, has also served as a minister for a considerable time.
Mr Coveney has, since last month, also reached the 20-year cap since he was first elected a TD in 1998 and his three-year stint as an MEP counts towards his service record.
Mr Varadkar has only been a TD since 2007 and his TD pension will be lower than the other two.
Those called upon to serve as a minister are entitled to another pension relating to the additional salary they receive for sitting at Cabinet. After two years, a retiring minister is entitled to a pension equal to 20% of his or her salary. After three years this becomes 25%, four years 30%, and five years 35%. The maximum entitlement is 60% after 10 years’ service.
Using the official guidelines to calculate the pension entitlements of ministers, we calculate the following:
- Mr Bruton earns €93,599 as a TD and a further €73,456 as a minister, a total annual salary of €167,055. Having well more than the maximum 20 years’ service as a TD, he is entitled to the maximum benefits which include termination payments of €74,069, a lump-sum payment of €140,398, and an annual pension for the rest of his life of €46,799.On top of this, we calculate he is entitled to an annual ministerial pension of €36,728. So combined, his annual pre-tax pension is worth €83,527, giving him an estimated retirement fund worth €1.8m.
- Mr Coveney also earns €93,599 as a TD but as Tánaiste earns an additional €88,284, giving him a total annual salary of €181,883.As he also now has 20 years’ service, he is also entitled to €74,069 in Dáil termination payments plus a lump sum of €140,398. He is also entitled to an annual TD’s pension of €46,799 but on top of that his ministerial pension with seven years’ service is calculated to be worth €39,727 a year. In total, this would entitle him to an estimated pension pot of €1.9m.
- Mr Varadkar is also paid €93,599 as a TD but gets an additional €103,587 for being head of Government. He would get a lower TD pension of €25,739 a year after he received termination payments worth €62,375 and a lump sum of €70,199.His ministerial pension has now been greatly enhanced because of his time as Taoiseach and all his seven years as a minister can be treated at the higher Taoiseach rate for the purposes of his pension.
This means in total he is entitled to an annual combined pension of €72,321 already and a total retirement pot worth €1.6m. This will only increase the longer he remains in office.
Since 2009, pension-related deductions apply to all State pensions.