Dáil Éireann Debate, Tuesday - 11 October 2011
43 Deputy Mary Lou McDonald asked the Minister for Public Expenditure and Reform if he attempted to rescind the special severance gratuity payment and added years awarded to the former Secretary General (details supplied) to the Department of the Taoiseach as agreed by the Top Level Appointments Committee, in advance or upon their retirement as allowed for in sections 6 and 7 of the Superannuation and Pension Act 1963. [28652/11]
View answerPrior to the appointment of the former Secretary General to the post of Secretary General to the Government in January 2000, the then Government decided that the terms applicable to Secretaries General appointed under the Top Level Appointments Committee, TLAC, process would apply in his case. At the end of his term in December 2010, the then Government confirmed the application of those TLAC exit terms on his retirement but deferred his retirement until 6 July 2011 at the latest. It was decided by the Government in June 2011 that his retirement be further deferred to 31 July 2011. In these circumstances, payment of the former Secretary General's superannuation and severance benefits was deferred until he ceased to hold office and his benefits were then paid in accordance with the Government decisions made on his appointment and on 7 December 2010.
The Minister will be aware that Mr. Dermot McCarthy received a pay-off of €713,000 and that his package will cost the State in the region of €6 million. Whatever about the time of his appointment, his retirement occurred on the Minister's watch. Whenever I question the Minister on this matter, he constantly invokes the Top Level Appointments Committee, TLAC. What the Minister studiously ignores is his powers under legislation, specifically, the Superannuation and Pensions Act 1963, section 7 of which——
Does the Deputy have a question for the Minister?
——states that the Minister, if in his discretion so thinks proper, can grant to the civil servant a special severance gratuity not exceeding one half of the annual salary of the office of the civil servant. That severance gratuity payment can only be paid on the Minister's say so. I take it from the Minister's response to my question that he made no effort to rescind that payment to Mr. McCarthy.
Section 6 of the same legislation, which I am sure the Minister has before him, refers to additional years. Mr. McCarthy received his full pension at the age of 57 years and there was no actuarial reduction despite his not reaching the standard pension entitlement age.
Thank you, Deputy.
I am sure the Minister will concede that TLAC cannot overrule the law of the land. I again put it to the Minister that he had the levers and discretion to stop the special severance payment, to put a halt to the award of additional years and to end the disgrace of this outrageous payment to this top civil servant but despite all of his rhetoric around change and transparency he failed to do that.
The Deputy likes to grandstand. I am conscious that we are speaking here about an individual who has served this State well over a long period. Senior public servants have families. I am conscious we are speaking now about an identified individual. While the Deputy might say I should have known about the TLAC terms since 1987, I only learned of them when I became Minister. Many of the people around the House to whom I have spoken did not know that Secretaries General were uniquely appointed on this basis. While I am reviewing and seeking to change that, I will not pretend I can changed it retrospectively.
The previous Government exercised the 1963 Act, to which the Deputy referred, in December of last year. It made that discernment and decision. Could I have undone it or recommended that it be undone is a point we could possibly debate. However, to do so would probably have been a breach of contract. It certainly would have had legal repercussions for us. I am in the business of reform. I want to reform on a cross public service basis. I have introduced the new pensions Bill, which it is hoped we will be debating next week, which will ensure we have a single pensions scheme across the public service. I will not pretend I can break contracts already in place for people who have legitimate expectations now. Other anomalies may well arise. I am grappling with each of those as they arise to do what is best in the interests of the taxpayer.
I will try do away with the TLAC severance payment. Pension lump sums and pension entitlements will be reduced in accordance with the reduced pay levels which will be applicable from February.
It is not grandstanding to say the Minister did not grapple with this issue, instead allowing this outrageous payment to go ahead. He also claimed there are other anomalies. What about the Secretary General of the Department of Jobs, Enterprise and Innovation who is supposed to retire soon with a large lump sum? The seven-year tenure of the Secretary General in the Department of Education and Skills is also soon to end. Can we expect more of the same from the Minister, hiding behind TLAC, the Top Level Appointments Committee, while not exercising the legislative function as set out in existing pensions legislation?
Deputy McDonald is not long enough in the House to know that I do not hide behind anything. That is not my form and I have never done so before. I answer questions upfront and never make pretence or grandstand on issues.
We need to change these arrangements in a way that is sustainable for the public purse. For example, I could spend moneys sending lawyers down to the Four Courts and pretend I can do things I cannot. There are two more potential retirees at the grade at which they would be entitled to the TLAC terms on this side of the end of February 2012 when the new pension regime comes into play. I am reviewing what can be done then because the TLAC terms provide options for me. I am going to review this on a case-by-case basis.
