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Dáil Éireann debate -
Thursday, 5 Nov 1987

Vol. 374 No. 11

Written Answers. - Public Service Redundancy Package.

74.

asked the Minister for Finance the average age of staff in his Department who have availed of the redundancy package offered to the Public Service; the cost to the Exchequer of the redundancy package; and if he will make a statement on the matter.

The scheme of voluntary redundancy-early retirement is being offered only in areas where identified redundancy or overstaffing exists or is reasonably expected to arise and cannot be fully met by redeployment. Since this position does not obtain at present in my Department the scheme is not applicable to any staff employed there.

The position however in the offices under my aegis is that 34 officers with an average age of 50 years have availed of the scheme. It is not possible at this stage to assess the cost to the Exchequer of these redundancies as the officers concerned are still considering the various options in the terms which are available to them.

77.

asked the Minister for Finance in relation to the voluntary redundancy terms being offered to the Public Service whether the lump sum being offered will be paid free of tax, or if they will be subject to income tax and, if so, if there is an exemption; and the rate at which the remaining amount would be taxable.

78.

asked the Minister for Finance in relation to the voluntary redundancy terms being offered to staff of AFT/ACOT whether the lump sums being offered would be paid free of tax, or if they will be subject to income tax and, if so, if there is an exemption; and the rate at which the remaining amount would be taxable.

79.

asked the Minister for Finance in relation to the proposed redundancy proposals for public sector workers if lump sum payments will be subject to income tax.

I propose to take Questions Nos. 77 to 79, inclusive, together.

The voluntary redundancy terms applicable to public servants provide for four distinct types of lump sum payment viz, (a) retirement lump sums; (b) short-service gratuities; (c) entitlements under the Redundancy Payments Acts; (d) additional severance gratuities. I am advised by the Revenue Commissioners that payments under (a), (b) and (c) above will be exempt from tax. Payments under (d) will be liable to tax, subject to the exemptions and reliefs provided for in section 115 and Schedule 3 of the Income Tax Act, 1967. In effect, this means that tax will not be charged in respect of additional severance gratuities if the amount involved is less than £6,000. In the cases of payments in excess of £6,000, the amount of tax payable will vary, depending on individual circumstances. Full details of the relevant tax rules are contained in Revenue Commissioners leaflet No. 14, copies of which will be furnished to Deputies Boland and De Rossa. The arrangements referred to above will apply to all categories of public servants who avail of the voluntary redundancy terms. Thus, there will be no distinction in tax matters as between staff in AFT-ACOT and staff in the Civil Service, for example.

80.

asked the Minister for Finance in relation to the proposed redundancy proposals for public sector workers the principles which are to be applied to requests of staff to redeploy.

It is intended that where staff surplus to requirements are identified they will, following any necessary consultation, through normal procedures, be redeployed where feasible to areas where their skills and experience can be used to the best advantage.

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