The Report is probably at its most disingenuous when considering the remuneration of a High Court Judge. The Review Body would like to make a recommendation for a downward adjustment in the salary for this position. However, on page 29, they remark: “There is a constitutional prohibition on a reduction in the pay of members of the Judiciary . . . . As a result we have not made a recommendation.” Why the reluctance to make a “recommendation”, as an absolute minimum, and let the judge’s conscience be the arbiter? But also, why did they not go a step further and highlight the need for an amendment to the Constitution? In terms of “sharing the pain”, Brian Lenihan could have insisted on a “recommendation” which would be fully enforceable and have a retrospective effect pending the constitutional change. I note that one journal pointed out that Brian Lenihan’s wife, Patricia Ryan, is a Judge of the Circuit Court.

KW said: “First, these performance-related awards were, as their name suggests, not guaranteed but (at least in theory) related to performance. This move appears to be an effective admission from the government that these payments were not in fact performance-related bonuses but part of the core pay of these civil servants.”….

Generally unions and the law sees bonuses as an entitlement. If they are not performance related then they must be paid. If they are performance related then they must be paid if performance is satisfactory or meets the defined criteria. Bonuses are pay for work done, not a gift. A cut of a bonus is a pay cut.

KW said: “Second, these bonuses were not pensionable….

Unless I misheard, the Minister’s said on Radio One today that the bonuses were fully pensionable. Can somebody clarify the actual position?

Lastly, I think the Minister said that the reduction in cuts only applies to about 200 people and that most higher grade civil servants will be taking the full cuts in their basic pay. Do we have exact figures on this?

For a bottom-of-scale clerical officer, the 5% cut in gross would translate into a cut in take home pay of more than 4% (given that so little tax and pension levy is paid at this level).

Whereas the marginal rate of deductions (pension levy included) for an assistant secretary would be in the low sixties percentage-wise. So their 3% cut in gross maps to barely a 1% cut in net pay.

I proceeded to produce my own mini-report using Europe’s richest nation as my comparator. Unlike Austria and Finland, web-based material on Norway is easily accessible.

My mini-report was sent to all members of the Oireachtas and to our Madam President in 2 stages, 4 to 6 weeks prior to the Budget. I had a number of acknowledgements including from the Taoiseach’s office and a confirmation from certain TDs that they would be forwarding the message for the attention of the Minister for Finance.

AS YOU WILL REALISE THE MESSAGE WENT UNHEEDED (as I expected it might; but I consider that we are in the earliest stages of what will be a long haul). AT THE TIME I USED 257000 EUROS AS THE TAOISEACH’S SALARY, SO YOU WILL NEED TO MAKE YOUR OWN ADJUSTMENTS FOR THE FACT THAT THE OFFICIAL SALARY WAS CONSIDERED TO BE 285,000 EUROS SO AS TO ENHANCE THE “CUT”.

MESSAGE FOLLOWS:

While there are one or two basket-case countries I can choose to compare with Ireland, the example I will use is Norway, the richest nation in Europe and the richest on earth in terms of per capita income.

Norway has wealth-generating resources in oil and gas and 4.5 million citizens. It is the nearest in population size to Ireland. So what might politicians expect if they were public representatives in Norway?

Norwegian MPs are paid an annual salary of €79,000 (1.5 times average earnings in Norway), compared with a TD’s salary of €122,000 (over 3 times average earnings in the Irish Republic which is NOT SUSTAINABLE). The average TD also claims up to €70,000 in expenses. This is NOT SUSTAINABLE.

I do not have details of expenses for Norwegian MPs, but those who are from constituencies more than 40 km from the Storting receive free accommodation assistance within Oslo. The Storting owns 140 flats for this purpose.

Norwegian government ministers earn about €100,000 per annum (less than 50% of their Irish equivalents who earn a NON-SUSTAINABLE €225,000 per annum).

The Prime Minister and the President of the Storting earn approximately €110,000, only about 40% of the salary of the Taoiseach, €257,000, a sum which was never justifiable and certainly NOT SUSTAINABLE in the present emergency.

The Prime Minister of Norway drives himself to work in his own car. He is only permitted to take a State car, from a pool, on State business. After State business is concluded, he must return the car to the Government pool, and make his own way home. In Ireland every minister is provided with a high-spec motor vehicle and chauffeur at an estimated cost of €140,000 per annum, NOT SUSTAINABLE. I also understand that each Irish minister receives constituency office expenses of around €180,000 per annum, NOT SUSTAINABLE.

Irish ministers are the most highly-paid executives of state in Europe. For ministers to have their pay brought into line with Norway, their salaries would need to be cut by 70%.

Ordinary TDs, also, are to be counted among the most grossly-overpaid members of the public-service community. The lack of leadership and genuine self-sacrifice on the part of both Ministers and TDs, puts them in no position of moral authority when preaching cuts for others.

Choosing Norway for a comparative study was not unreasonable, and my findings suggest that an immediate 60 to 70% cut in TD’s salaries would be in order just to bring them into line with Europe’s richest nation.

In future years, other factors will need to be taken into account when determining cost-cutting measures for Ireland’s political elite.

· Ireland’s relative poverty

· Our small population with political over-representation

· The fact that the average TD is claiming up to €70,000 per annum in tax-free expenses – up to 2 times pre-tax average earnings. Unlike the UK, no leader of an Irish Political Party has called for his party colleagues to reimburse taxpayers for unwarranted claims

· TD’s salaries and benefits in kind are often supplementary to other major sources of income

· Irish “populist” politics fanned the flames of UNSUSTAINABLE GROWTH and brought about the greatest economic collapse in the Anglo-American world. Questions must be raised about the competence of all our politicians and the need for reform which will allow for highly-qualified specialists, from outside the Dáil, to fill key ministerial posts and take tough, responsible, non-populist decisions in good times as well as bad.

The Taoiseach earns 8 times Irish average earnings and has a full-time chauffeur. His counterpart in Norway is earning just over 2 times Norwegian average earnings and must use a car-pooling arrangement when he needs to be chauffeured.

The Taoiseach must recognise that the situation, as I have described it, is NOT SUSTAINABLE. The Irish political gravy train simply has to end!

Very good point, you’re quite right. I’ve rephrased. Thanks.

“Late on December 23rd, the Department of Finance announced it will not cut senior civil servants’ pay.”

Eh, just for clarity, they announced the cuts, in reality, will be a lot less than expected. But they did not announce they would “not cut senior civil servants pay”. Not trying to downplay it, but no need to overegg the actual decision either.

TAOISEACH’S REDUCED SALARY:

The Taoiseach’s salary is to be reduced by 57,117 euros giving a new salary of 228,466 euros. Based on current exchange rates this will be 11,000 euros more than Gordon Brown’s Salary.

Gordon Brown has been entitled to a salary of £197, 689 (including MP’s salary of £64,766) from 1 April 2009. He has elected not to take the pay rise for 2009-10 either in his ministerial or parliamentary salary.

197,689 British pounds = 219,471 Euros

People should also bear in mind that the UK has 15 times the population of the Irish Republic

LATER I WILL MAKE A COMPARISON WITH NORWAY, EUROPE’S RICHEST NATION, WITH 4.5 MILLION INHABITANTS, THOUGH NOT MEMBER OF THE EC AND NOT INCLUDED IN THE REVIEW BODY’S REPORT DESPITE ITS HISTORY OF COMPARATIVELY SUPERIOR GOVERNMENT

I am surprised that the Review Body should have chosen Austria for comparison purposes. On page 28, the Report considers the equivalents for the posts of Secretary General, Levels I and II, in Ireland. In each case the Report discloses: “An appropriate comparator for this role could not be found in Austria”. However, when comparing with Finland, the Report admits the following in relation to the Level I and II posts: “The rate for the equivalent post in Finland, with which the Irish post is banded, is 50% of the Irish rate.” The Report never reveals actual salary amounts for the comparator countries or the manner in which adjustments were made, so I will refer only to BASIC-SALARY comparisons. Finland with a population of 5.4 million is the nearest in population size to Ireland.

PAGE 33 For Ireland, the pre-budget salary of Secretary General, Level I is given as €300,358 and for Level II the figure is €266,985 with a recommendation for a 15% cut, which, based on recent news reports has been almost entirely revoked. This decision is astonishing when you consider that the posts in Ireland are being rewarded with salaries 100% higher than in Finland, the country closest to Ireland in terms of population size.

On pages 28/29, the Report reveals that, in the case of the position of Assistant Secretary in Ireland, “the rate for the equivalent post in Finland, with which the Irish post is banded, is 74% of the Irish rate. The maximum point on the pre-budget 4-point scale given for ASSISTANT SECRETARY on page 33 is €158,644 with the lowest point given as €138,683. I am confused: To which one of the 4 figures does the 74% comparison apply? Does it apply to an average? I suspect that it is a comparison with the lowest figure; but it is not possible to check from the Report in the version released. In any case, it is safe to say that the Assistant Secretary in Ireland is paid at least one-third more than his Finnish counterpart.

MORE TO FOLLOW

“Senior civil servants close to retirement have been almost completely protected from the consequences of the fiscal crisis.”

The government has therefore scrapped the Christmas bonus for those on social welfare so it can pay-off senior civil servants to keep quiet about its bailout of developers/bank investors.
Merry Christmas from FF/PDs!

Now, I don’t know how long it takes Google to index pages on the Department of Finance website… but even at 4 hours, we’re down to only 1 working day before Christmas, a working day where even Norad are tracking Santa…

A cursory view also reveals that the document is a departmental circular and not a press release. That does not bode for it to be “discussed in the media”; it bodes for “damn, I have to release this, maybe if I do it on this day, no-one will notice”.

Finally, you have said a number of times that you are from north of the border. I put it to you that cynicism with regard to both the government and the senior civil service serves us well here in Mexico. Indeed, many of us who have lived through more than one crisis of the state will probably consider that we have been insufficiently cynical heretofore.

On the substantice issue, do I feel let down?… see cynical comment above. ‘Course I do. Liars and thieves.

How about other nations? I suspect the same principle of adjusting BASIC SALARY before deciding on the final ADJUSTED INCOME is happening. For example, on Page 27, para 4.3, the Report states: “The salary earned by the Taoiseach was found to be second highest of the comparators, slightly behind Austria and significantly ahead of that of the other five head of government positions.”

The monthly salary of the Austrian Chancellor is €19,762.60 giving a 12-month salary of €237,151.20. The Taoiseach’s pre-budget official 12-month salary is €285,583, that is, €48,431.80, or 20.4%, greater than the Austrian Chancellor. The Report could only come to its conclusion given above when you multiply the Austrian Chancellor’s monthly salary by 15 to get €296,439. I checked again with the Austrian Embassy in Dublin who informed me that the Chancellor would have received a month’s bonus in June and again in December, giving a 14-multiple of €276,676.40, still short of the Taoiseach’s official pre-budget salary by €8,906.60. Again, the Review Body are making adjustments to BASIC SALARY even before they come up with the final ADJUSTED INCOME. The Review Body need to explain their figures in greater detail. (NO TABLES OR COMPARISON FIGURES ARE SUPPLIED IN THE WEB VERSION OF THE REPORT)

Given that the Review Body were making comparisons with other European nations, I find it difficult to comprehend why they did not choose the gross monthly income to achieve initial like-for-like comparisons for BASIC SALARY. Subsequently they might have made adjustments for total earnings over 12 months to arrive at the figure for ADJUSTED INCOME.

MORE REVELATIONS TO FOLLOW IN DUE COURSE

This was always going to be the case. These people are insiders and therefore untouchable.

FF are the party of the insider, they created the monster that is the civil service. Civil service jobs are family heirlooms, handed down from one generation to the next just like dail seats.

Only a revolution will bring about the type of real reform needed to end this gravy train and I do not see that happening anytime soon.

So expect this type of in your face self serving protectionism to remain the order of the day.

They don,t think we care enough to do something about it and so far they have been right.

This story wasn’t on the front page of the Sunday Indo that I read yesterday. Perhaps you read a different edition.

But I agree it’s the substance that matters and that this substance is not the amount of money this costs (relatively small) but the other issues. We have been told so many times that those at the top will take the biggest hit and here we are finding that some of these people will receive pay cuts of only 3% as a result of the budget while those on lower incomes are getting cuts of up to 8%. If you’re looking for people to accept the process as fair, reasonable and well-thought out you simply have to do what you say you’re going to do.

The claims to be following the advice of the Remuneration Body turned out to be false. And the attitude that this reveals to bonuses in the public sector is also worrying.

Finally, who knows about the decision to time the release for Dec 23rd but you can’t tell me that the media-savvy people in the government press office didn’t know how this would look to those who did notice it.

Noel Coward

in fairness, it was the lead article in both the S-Indo and the SBP yesterday, so its not as if it went unnoticed. I think the timing issue was more a ‘nice’ coincidence rather than some pre-meditated act of the government. As JtO noted, the budget itself was less than two weeks before this release.

Of more relevance is the substance of the matter, which is irritating and depressing in equal measure. Any one know how much this will “cost”/”un-save”? I doubt its a particularly significant amount, but the higher end of the civil service really needs to lead by example if we’re going to overhaul the public sector.

On a related (-ish) note, i thought i read somewhere that the Unions bosses typically have their pay benchmarked again senior civil service pay grades (though i could be wrong?), so does this mean that Begg, O’Connor & Co will also gain as a result of this decision?

There has been repeated calls for decreases in the salaries of some civil servants, particularly over the past year. These decreases certainly appeared to be promised quite explicitly in the budget. That it now appears only small fraction of the decreases will actually be executed is surprising.

You can have every confidence that the small and middling fry in the public service - the home helps, the road sweepers, the clerical officers, the primary teachers, etc. - will still be getting walloped as promised. Only a small and very select band will escape.

1) The promises made to lead by example are being reneged upon. This is most unfortunate, particular for those among us who were relatively impressed by the Budget, because of this feature of the austerity programme.

2) It shows, yet again, how this govt is unable to coherently respond to the fiscal crisis, and brings into question other aspects of the austerity programme which might be jeopardised by incompetence or dishonesty.