Ireland's top civil servant Dermot
McCarthy retired this summer on a €713,000 package and a future cost of
millions. He turned 57 last June.
McCarthy was secretary general to
the Government, since January 2000 and additionally secretary general of the
Department of the Taoiseach since July 2001. He was the main civil servant
liaison in the so-called partnership process and was in charge of what was
'benchmarking,' which was a roundabout way of giving public servants a
special pay increase that averaged 9%. There were 'efficiency' targets to be met
as part of the process but civil servants themselves considered them a joke.
In Oct 2007, almost 3 months after
the onset of the international credit crunch, a higher remuneration body recommended that McCarthy get a special 25% pay
In an article,
Where is the Outrage? Gombeenism thrives at home while in Paris, OECD staff work
on proposals for Irish public service reform, we said:
VIP Benchmarking has provided additional benchmarking increases over the sham
benchmarking that every politician, civil servant and retiree received some year
ago. The additional Super VIP Benchmarking has been provided by a mechanism
known as the Buckley reports. This year, the secretary-general of the
Taoiseach's Department has got one of the biggest hikes - - 25% - - he will no doubt
be in charge of drafting the pleas for pay restraint that will
inevitably emanate from his Department in the coming year. The Taoiseach's chief
flunkey/political adviser Gerry Hickey gets paid €210,141-
- a doubling in ten years compared with a 30% rise in the Consumer Price Index.
City Manager got a whopping 36.2% pay rise of €66,000, going up from €184,000 to
€250,000 - - there will of course be the béal bocht for the lower paid in the
Following a public outcry, officials such as the Dublin City Manager, were given a 5% pay rise.
wrote in The Sunday Independent in respect of the pay increases of 15% that were recommended for the Cabinet: "Of course in situations such
as this our politicians love to use that well-worn phrase about paying peanuts
to get monkeys. However, a look at our Cabinet suggests that even though we are
paying them loads of cash, we're getting a lot of Stans and no Jacks.
were not ministers, Micheal Martin, Mary Hanafin and Noel Dempsey would be
school teachers whilst Brian Cowen and Dermot Ahern would be nothing more than
small town solicitors.
may very well be the great defender of the private sector but our heroic scourge
of dirty nurses and greedy hospital cleaners has managed to avoid the delights
of working in the private sector for her entire career.
Bertie, if he had not being busy saving Ireland our Taoiseach would now be a
balding harried accountant in the Mater and no, the rest of the CVs aren't
particularly inspiring either."
C'est la vie!
In addition to an annual pension of
€142,670, McCarthy received a once-off lump sum of €428,011. He also got a full
year's pension as a special severance payment of €142,670. The overall package
was worth €713,000. Details of the package were released to RTÉ under the
Freedom of Information Act.
The lump sum is based on 1.5 times
final salary; even though McCarthy’s annual salary had fallen from €285,000 to
€208,000 because of pay cuts in recent affecting high-earning public servants
and ministers, his final salary for pension purposes remained the original
figure of €285,000, giving him the lump sum of €428,000.
Handy going for a man who unlikely
ever had to make a consequential decision himself, in his professional life.
McCarthy paid tax on the first €200,000 of
the €428,000 but following changes in the Finance Act 2011 also paid tax of 20%
(or €45,600) on the remaining €228,000. The net worth of the lump sum is
Unless the existing pension system
is changed, any pay increases successors in his position will get, he will get
the same increases on his pension.
The current system is a shameful
one. It was devised by politicians and senior civil servants who are the main
People with guaranteed job security
from the State, in addition are paid pay premiums over counterparts in the private
sector and have an unfunded very generous pension system, paid by workers in the
private sector, who typically have none.
Full text of the letter
from the Department of Public Expenditure and Reform to RTÉ News:
Dear Mr Hunt
I refer to your request under the
Freedom of Information Acts 1997 and 2003 for details of the severance pay and
pension arrangements for Mr Dermot McCarthy, retired Secretary General,
Department of the Taoiseach.
I am setting out below the details
of the severance and superannuation arrangements that applied to Mr McCarthy,
which are based on the standard Top Level Appointments Committee (TLAC) terms
applied to Secretaries General in accordance with Government decision of 5 March
Pension ... ... €142,670.50.
Lump sum ... ... €428,011.50.
Special Severance Payment
The pension was based on Mr
McCarthy's salary prior to the salary reduction under the Financial Emergency
Measures in the Public Interest (No.2) Act 2009 (€285,341) and 40 years service
(including 67 days additional notional service). An annual reduction of
€13,980.49 is applied to the pension under the Financial Emergency Measures in
the Public Interest Act 2010. The lump sum was subjected to taxation in
accordance with new pension lump sums provisions in the 2011 Budget/Finance Act.
These superannuation arrangements
are subject to the abatement terms that apply to Secretaries General
superannuation in the event of them resuming employment in the Public Service.
Department of Public Expenditure and Reform