€1.1m bonanza for four retiring TDs
The four TDs who have declared their intention not to stand at the next election -- Tom Kitt, Liz McManus, Mary Upton and Olwyn Enright -- will share a pot of €1.1m in the first two years of stepping down in generous termination and pension payments.
In total, the value of the lump sum pay-offs and pensions for the four TDs over the lifetime of their political retirement has been calculated at over €12m.
The revelations of their generous exiting packages comes as the Cabinet is to meet twice a week to prepare for the December 7 Budget, which is expected to lead to higher taxes and reduced public services, and follows two years of tax rises, spending cuts and increasing unemployment.
The payments were yesterday heavily criticised by economist Jim Power who said such payments "erode the moral authority" of the political class at a time when taxpayers are facing into another painful budget.
"We are facing into two more horrendous budgets and revelations like these are highly damaging. These sort of payments totally send out the wrong message to people who are being screwed royally at the moment" said Mr Power, chief economist with Friends First.
An examination of the terms and conditions for departing TDs reveals an extensive and remarkably elaborate system of payments -- all paid for by taxpayers.
Under the system, all four will first receive a termination allowance equivalent to two months of their salary, worth €16,404 in the immediate aftermath of stepping down. They will then receive a further €36,906 over the next six months in a sliding scale of their salary.
After that six months, based on their service, they will receive between €20,000 and €32,000 until their termination payment runs out.
The figures were calculated on the basis of the Dail running until 2012.
Once the termination payments finish, the Rolls Royce pension payments to each member commence. Based on current pay levels, they will each receive a tax-free pension lump sum of €147,636.
And then every month until they die, those with over 20 years' service in the Oireachtas will receive half the amount of salary which is currently over €98,000.
The best part of the deal is that pension amount is inflation protected and indexed linked to salaries of current incumbents.
Former government chief whip and junior minister Tom Kitt and Labour TD Liz McManus will both receive at least €274,000 in termination and pension payouts in the first two years of stepping down.
On Friday, the Department of Finance released figures which showed Mr Kitt received €24,733 in severance payments after he was sacked as chief whip by Brian Cowen.
Liz McManus was paid another €5,485 in pension payments because of her time as junior minister between 1994 and 1997.
However, according to the finance accounts document, she surrendered €3,357 of that amount back to the State.
Retiring Labour TD Mary Upton will receive €260,820 within the first two years of stepping down.
She will get the full termination payments as well as the full pension lump sum, but her annual pension will be lower than that paid to Kitt or McManus.
Olwyn Enright, Fine Gael TD for Offaly who is pregnant with her second child, has been a TD since 2002 and will receive about €61,000 in termination payments in the first year after she steps down.
Under the terms of the pensions' scheme, she cannot claim her full pension until she is aged 50, but she will be entitled to claim a reduced rate from the age of 45.
According to the calculations once she reaches the age of 50 she will receive a €147,00 tax free lump sum (one-and-a-half times her annual salary) and an annual pension worth at least €31,000.
The four are the only TDs officially not seeking re-election, however it is thought likely that Fine Gael TD PJ Sheehan won't stand again.