Minister for Public Expenditure and Reform Brendan Howlin has announced plans for pay caps for higher-paid public servants and the chief executives of commercial State companies.

He said the Government had agreed on its election to a 'general' pay ceiling of €200,000 for future appointments to higher positions in the public service, with a €250,000 level for future chief executives of State companies.

For existing holders of such positions, however, the Government has decided to seek voluntary cuts of 15% of salary, or a smaller amount if this brings the level below the proposed ceilings.

The minister said the Government recognised that in a small number of cases exceptions may be necessary.

'Such exceptions will be limited to instances where the exception is for a role of substantial importance in the public service or a commercial state company and the person whose appointment is sought brings exceptional or scarce expertise and/or qualifications to the proposed role,' he added.

Mr Howlin will also review the current system of performance-related pay schemes for CEOs of State companies in conjunction with ministers in the relevant departments.

However, salaries for National Treasury Management Agency and National Asset Management Agency are excluded from pay caps for chief executives commercial semi States.


Speaking on RTÉ News, the minister said that there are 16 people working in NAMA and the NTMA who breach the new €200,000 salary cap for public service employees.

He said he would be seeing how there could be some burden sharing by them.

Brendan Howlin said he would expect them to take stock of their position, like everyone else, and understand the very difficult situation this country is facing.

The minister said that in the commercial semi-state sector, the Government had looked at how to preserve commercial independence with a reasonable pay level and that it was decided to set the limit at €250,000.

He said the only breach of this limit in the commercial semi-state sector would be the next CEO of the ESB.

A spokesperson for Mr Howlin said he would be writing to the Minister for Finance Michael Noonan about the issue.

He said all the secretaries general of Government departments who breach the €200,000 cap have volunteered for the cut today.

The minister said he expects that to be replicated across the public sector and in any event there is significant churn in the positions, and as new appointments are made the new pay rates will be applied.

On the issue of bonus payments, Mr Howlin said that the Government had written to the boards of the semi-States asking that no bonuses be paid.

Minister Howlin said that the issue of bonuses and incentives would be looked at in the future and allowed where goals are set and are independently validated.

Elsewhere, the Dáil has rejected a motion from the technical group calling for no cut in wages that are now set by Joint Labour Committees and no cut in pay rates for those working unsocial hours.

Instead, the Dáil voted by 96 to 41, to support the Government, which maintains the need for reforms of such wage agreements.