New seagoing tax credit will not stop retention crisis, say Naval Service bodies

Naval Service representatives have welcomed a Government announcement of a special tax credit of almost €1,300 a year for those on sea patrol duty but say it is not sufficient to stop the haemorrhaging of personnel from the service.

Both PDFORRA, which represents non-commissioned ranks in the Naval Service, and RACO, which represents commissioned officers, said the tax credit is a step in the right direction but will not be enough to retain personnel.

Minister of State Paul Kehoe confirmed in a statement on Monday evening that, following talks with Minister for Finance Paschal Donohue, an amendment to the Finance Bill will allow for a tax credit for seagoing naval service personnel.

The new tax credit, which will be known as the Sea Going Naval Personnel Tax Credit, will apply from 2020 and will be worth €1,270 a year to personnel who spend at least 80 days at sea next year.

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Mr Kehoe said the measure builds on the Government's commitment to addressing the challenges currently facing the Defence Forces including the Naval Service.

“This new tax credit for seagoing naval service personnel is a reflection of the challenging work they carry out, their lengthy periods at sea and away from their families,” he said.

"I am delighted Minister Donohoe is introducing this amendment at report stage. It is the result of constructive engagement within Government, by my officials and Defence Forces management, including those in the naval service."

Not enough

However, PDFORRA president Mark Keane, himself a member of the Naval Service, said that while the provision of a special tax credit for Naval Service personnel at sea was a step in the right direction, it was not enough.

"This move is welcome but unfortunately the Public Service Pay Commission gave us an increase of just €2.50 to the Patrol Duty Allowance to bring it to €53 for every day at sea, which is taxed, so people are only getting half that in reality.

Our current numbers are around 975 but we need 1,094 to keep all nine ships at sea

"The seagoing tax credit needs to be combined with a proper increase in the Patrol Duty Allowance – we sought an increase to €83 a day, the equivalent of Portlaoise duty for those working in the prison, so we're well short of that."

Mr Keane said he didn’t believe the new tax proposal would be sufficient to stop the haemorrhage of personnel from the Naval Service, which has resulted in two ships having to be tied up since July due to lack of crews.

“Our current numbers are around 975 but we need 1,094 to keep all nine ships at sea and this move, while welcome, isn’t going to solve the recruitment and retention crisis and ships are going to remain tied up,” he said.

RACO general secretary Conor King welcomed the new tax credit but also stressed it should be seen simply as a first step towards improving pay as a means of addressing the retention crisis in the service.

He said Naval Service members “operate in a hazardous, high-risk environment, and this proposed tax credit is a small but welcome first step in recognising the huge sacrifice made by sailors working at the coalface of maritime defence and security operations”.