New secretary general of Department of Health waives €81,000 pay rise for now

The substantive pay rate for the role of secretary general of the Department of Health is to remain at the level of €292,000 approved by the Minister for Public Expenditure Michael McGrath last December.

Robert Watt, who had been serving as interim secretary general at the department since January, was formally appointed to the role by the Cabinet yesterday.

Mr Watt, who up until recently was secretary general at the Department of Public Expenditure and is currently paid the €211,000 salary attached to that post, said he would not be accepting the higher rate, for the present.

“The proposed salary for this role is higher than my current salary. I don’t think it is appropriate to take such an increase in pay given the current difficult economic conditions the country faces,” he said in a statement.

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“It had always been my intention that, if I were to be appointed to this role, I would waive this increase until the economy begins to recover and unemployment falls.”

The details of how the waiver of the proposed €81,000 pay rise for the post will actually work were not made clear yesterday. The Irish Times asked the Department of Health whether there were specific targets for economic recovery or for a reduction in unemployment that would trigger the full salary being paid to Mr Watt. A response had not been received last night.

It is understood that under existing “gifting” arrangements in the public service, the individual concerned alerts the payroll section of the salary amount that is not to be taken. Income tax is not paid on the amount waived, but pension entitlements are calculated on the substantive rate for the grade.

Recouped

Such “gifting” arrangements are generally reviewed at the end of a tax year, but informed sources said they could be rescinded by the individual at any stage. However, the sources said that under the current system money waived for a particular year cannot be recouped at a later date.

The Government decision in early January to set the pay rate for the job at €292,000 made it by some distance the best remunerated post in the civil service, though some positions in the broader public sector – such as the chief executive of the HSE – have higher salaries.

The Oireachtas finance committee is scheduled to hold hearings shortly into the pay of top-level public service posts and the background to the setting of the salary level for the job.

Cabinet members on Tuesday backed Mr Watt’s appointment, with Minister for Stephen Donnelly saying he would bring “a wealth of experience” at a time when the department faced challenges such as the Covid-19 vaccination programme and the implementation of Sláintecare reforms.

Tánaiste Leo Varadkar said Mr Watt was taking on a “crucial position in our public service” which should carry a similar salary to that of the head of the HSE or or a semi-State company.

Minister for Finance Paschal Donohoe told the finance committee he stood over the Top Level Appointments Committee process that taken place.

However, committee chairman John McGuinness said: “I couldn’t stand over the process of selection. I have grave reservations about the political input into the whole idea that the salary should be increased by 80-something odd thousand.”

He also claimed “the whole process to date smacks of an old boys club. They decided on the outcome and then they decided how they were going to get to that outcome. That’s my strong belief”.