Howlin announces civil service cuts

Minister for Public Expenditure and Reform Brendan Howlin

MARTIN WALL, Industry Correspondent

The Government is to introduce significant cuts to pension arrangements for top-level civil servants appointed in the future.

Minister for Public Expenditure and Reform Brendan Howlin said today that the Government would end current arrangements under which secretaries general in Government departments can retire early with immediate pension, the provision of added years for pension purposes and special severance payments.

The Minister said that for secretaries general appointed in the future there will be:

-  No added years

-  No pension payable prior to the minimum pension age

-  Offers of alternative posts where secretaries general are from the Civil Service and do not have 40 years service and have not reached minimum pension age

-  No severance pay except in the case where a person is not of minimum pension age or has not been offered an alternative post; then severance of up to one year’s salary applies.

- No severance payment where a person is offered an alternative post and refuses to take up the position.

The Minister said the Government’s actions would result in "substantial" savings for the taxpayers.

“A balance has to be struck to ensure that the right people capable of taking on the complex challenges our country faces now, and in the future are in place," he said. "Accordingly we will review the new terms after 12 months to see that they are effective in attracting the desired candidates.”

There was considerable controversy several weeks ago when it emerged that the former secretary general at the Department of the Taoiseach, Dermot McCarthy had retired in the summer with a total pension package including lump sums of €570,000 and an annual pension of €142,000.