Ahern and Cowen's pensions to drop by over €4,000 a year
Published 30/11/2011 | 05:00
If the pensions were not combined, the retired politicians would have escaped the bulk of the new pension tax due under an anomaly.
The cut was introduced as a last-minute change to the new law allowing for judges' pay to be reduced.
The Government rushed in an amendment to the legislation after finally getting legal advice telling them the cut could not be challenged in the courts.
Taoiseach Enda Kenny said there were around 250 people on what he described as "super pensions" of over €100,000. After appearing to rule any cut being in the pipeline just a fortnight ago, Mr Kenny said he had been picking up the public anger wherever he went.
Public Spending Minister Brendan Howlin admitted the savings made from the cut were "modest" and would bring in just €400,000 a year.
Since the start of the year, the plum pensions have been subject to a rising scale of cuts:
- 0pc on the first €12,000.
- 6pc on the next €12,000 up to €24,000.
- 9pc on the next €36,000 up to €60,000.
- 12pc on the rest above €60,000.
And the new cut will mean a cut of 20pc on any amount above €100,000
Meanwhile, Social Welfare Minister Joan Burton last night intensified speculation about a cut to child benefit.
Ms Burton said she was having discussions with colleagues about child support welfare payments, but could not reveal what would be in the Budget yet.
"It will, unfortunately, be necessary to have cutbacks," she said.
She failed to rule out any cut to child benefit, which is expected to be reduced by €10 per child, and pointed that the payment was higher than in the North.
Mr Howlin said he believed the measure should be implemented "in the broad public interest". He said the Government got advice from the Attorney General Maire Whelan allowing it to proceed with the cut.
The Coalition was concerned that cutting the pensions would result in a court challenge.
"The Attorney General has advised that pension entitlements are vested property rights that have already been earned but, as we know, the existing legislation already affects vested pension rights in the public interest," he said.
The measure will affect a wide variety of retired public servants on pensions over €100,000, including former presidents, Taoisigh, ministers, senior judges from the High Court and Supreme Courts, university chiefs, government department secretaries general, chief executives of non-commercial state bodies, some hospital consultant doctors, garda commissioners and chiefs of staff of the Defence Forces.
Mr Howlin confirmed that for former ministers and Taoisigh who have both Oireachtas pensions and officeholders pensions the levy will be "administratively calculated on an aggregated basis".