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Friday 19 September 2014

€20m bill for departing councillors' severance

Daniel McConnell Political Correspondent

Published 02/06/2014 | 02:30

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THE taxpayer is to foot a bill of almost €20m to cover severance payments to local councillors who either lost their seats or who retired.

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It has emerged that councillors who lost their seats or stood down after last week's elections weekend are to receive severance payments almost as high as those for former government ministers.

Long-serving members with 40 years of service will get severance packages worth €64,000 now they are stepping down, according to an internal circular to members of the Local Authority Members Association (LAMA).

The dossier shows that a councillor who has served just one term of five years and who lost their seat or otherwise decided to quit will get a lump sum of €16,724.

If they have served two terms over 10 years they will get €33,448.

The payments increase in five-year hitches to €63,968 for those who have served 40 years on the country's various councils.

The payments are based on the number of years served, by one-fifth of the councillors' basic annual "representational payment" of €16,724.

On retirement, councillors with at least two years' service will receive a lump sum payment of a gratuity for service from May 4, 2000, and an ex-gratia payment for years of service prior to that date up to a maximum allowable 40 years' service.

Under the current rules, for every year served since 2000, a councillor receives a payment of €3,344 a year, when the governing legislation was changed.

Those who served before 2000 are entitled to a second severance ex gratia payment of up to €714 a year for the first 20 years of service and €476 for any additional year after that.

The pre-election LAMA circular to councillors gives the examples of the "approximate payments to county and city councillors retiring in 2014" and offers advice on what tax may be due or be exempted for the lump-sum payments.

Up to Friday's elections, there were 1,627 town and county councillors in 114 councils. But under the forthcoming changes the numbers have been reduced to 91 councils and 949 councillors. However, the four Dublin councils have had their numbers increased.

LAMA made a submission last year to the Oireachtas Joint Committee for the Environment outlining concerns that while councillors pay PRSI on their basic salary they are not entitled to welfare benefits if they lose their jobs or are not re-elected.

They also argued for a change in the current arrangement where lump sums on retirement or non-election are not paid until the ex-councillor reaches the age of 50.

Irish Independent

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