Former councillors to share €5.4m in severance payments

Recently merged Tipperary council to pay ex-councillors in excess of €1m

Cash payout: more than 200 former councillors are set to receive severance payments totalling in excess of €5.4 million in the wake of losing their seats in local elections or due to the abolition of councils. Photograph: David Sleator

Cash payout: more than 200 former councillors are set to receive severance payments totalling in excess of €5.4 million in the wake of losing their seats in local elections or due to the abolition of councils. Photograph: David Sleator

Mon, Aug 18, 2014, 01:00

More than 200 former councillors will share in over €5.4 million in severance payments from 12 local authorities, having retired or lost their seats after the recent local elections or through the abolition of borough and town councils.

It brings to more than €9.1 million the amount to be paid by 22 local authorities to former county, city, borough and town councillors after The Irish Times published figures earlier this month showing that 10 other local authorities will make payments totalling ¤3.6 million to 152 former councillors.

The figures include payments due to former councillors who have already reached the age of 50 but do not include “preserved payments” for ex-councillors under that age. Former councillors become entitled to a severance payment when they reach 50.

Payments breakdown

Dublin City Council only provided figures for former councillors who have received payments to date while a further nine councils have not yet finalised severance payments arising from May local elections.

The recently merged Tipperary County Council will make payments totalling more than €1 million to former councillors. The bulk of this will go to 49 former county and town councillors who have already reached the age of 50 who will receive €891,583 between them.

A further 22 former members who have not reached that age will be entitled to €191,000 between them, based on the amount they were receiving in representational payments. However, these amounts will have to be recalculated on the pay rate in place at the time each councillor reaches 50.

Waterford City and County Council, which was formed after the merger of the city and county councils, will pay almost €685,000 to 25 former city, county and town councillors. A further 10 councillors will be entitled to payments at the age of 50.

Meanwhile, Clare County Council will make payments ranging from €2,260 to €61,782 to 28 councillors at a total cost of €672,000.

Sligo County Council did not provide figures for amounts due to former county and borough councillors. However, based on figures provided by the council setting out the length of service of 12 outgoing members who have already turned 50, The Irish Times calculated that they will receive €501,000 between them.

A further six former councillors will have their payments preserved.

Gratuities

Dublin City Council has made payments totalling €164,253 to eight former city councillors to date. However, a spokeswoman said last week that the council was not yet in a position to provide the estimated overall cost of severance payments to all former councils. Following the local elections in May, The Irish Times contacted all city and county councils asking for a full list of severance payments, also known as gratuities, to outgoing councillors.

A total of 22 councils have provided figures to date. A further nine councils – Cavan, Cork, Donegal, Kerry, Kilkenny, Laois, Louth, South Dublin and Wicklow County Councils – are still collating the relevant information.

A spokesman for Cork County Council said a total of 16 former county council members who retired or lost their seats in the last local elections were entitled to severance payments.

He said the council also had 12 town councils under its jurisdiction, meaning 108 former town councillors are in line to receive severance payments.

This is over and above the €410,633 due to nine former members of Cork City Council, which is also due to pay three former councillors €56,633 between them, a figure based on what they were receiving in representational payments at the time they retired or lost their seat.

The bulk of former councillors’ severance payments are calculated by dividing the annual representational payment associated with their position by five and multiplying it by the number of years they served after the year 2000.

Councillors who served prior to 2000 also receive an ex-gratia payment dependent on the number of years served.

The maximum severance payable to a former city or county councillor who lost their seat in the most recent local elections is €63,969.

The gratuities presented above are gross amounts and are subject to tax under the Tax Consolidation Act 1997 and are also subject to the universal social charge.