The Government has said it is committed to ending the exceptionally generous pension regime for those at the top of the public and private sectors.

It follows the revelation today that Ireland’s top civil servant, who retired during the summer, received nearly €600,000 in lump sum and severance payments.

Dermot McCarthy, who was the former secretary general to the Government and to the Department of the Taoiseach, will also receive an annual pension of €142,000.

In a statement, the Government said while it is not possible to change existing arrangements, the Programme for Government commits to capping taxpayer subsidies for all future pension schemes at €60,000 per annum.

It goes on to say that the reforms are complex but are being advanced and will be ready by the Budget.

Sinn Féin Deputy Mary Lou McDonald this evening described the final lump sum payment and pension of Mr McCarthy as completely inappropriate and scandalously high.

Mr McCarthy was appointed secretary general to the Government in the year 2000 and served under three different Taoisigh.

During the Bertie Ahern era, it is said, he was instrumental in bringing about social partnership and bench-marking.

He was the country's top civil servant, attended Cabinet meetings and was in Government Buildings the night the bank guarantee scheme was agreed.

He retired from his post at the start of the summer and new figures, released to RTÉ News under the Freedom of Information Act, reveal how much his severance and pensions entitlements are worth.

They show he got a lump sum payment of €428,011.50 and a special severance payment of €142,670.50.

His annual pension is €142,670.50.

The figures are based on 40 years of service and a salary of €285,000 although with various cuts and voluntarily contributions his salary at the time of his departure was €200,000.

The Department of Finance said today the superannuation arrangements for Mr McCarthy are based on the standard terms applied to secretaries general and they said the lump sum was subject to taxation.

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 1987.

Pension ... ... €142,670.50.

Lump sum ... ... €428,011.50.

Special Severance Payment €142,670.50.

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.

Yours Sincerely

Tony Jordan
Pensions Section
Department of Public Expenditure and Reform