Legal threat wins Revenue man €141,000 pension top-up
THE Revenue gave a €141,000 pension top-up to a retiring senior staff member after he threatened legal action.
It was decided that the man was entitled to it only after his previous service in a position in the European Union was taken into account.
But the Revenue and the Department of Finance had a lengthy debate on which of them should pay for the top-up to ensure the man got a full pension.
The issue of top-ups has attracted controversy because they increase the overall size of the annual €2.3bn public sector pension bill -- which must be paid out of current tax revenues.
According to correspondence released under the Freedom of Information Act, the official, whose name has not been released, was so concerned at the delay caused by the wrangling that he threatened legal action.
Revenue assistant principal officer John McBride said the man's solicitors had written to the Revenue on a number of occasions.
"They point out that this matter has been ongoing since September 2006 and that if they do not receive a positive reply in 14 days, they will issue proceedings," he told the Department of Finance.
The man succeeded in getting the Revenue to pay for a €141,722 "pension top up" which ensured he would be able to retire on a full pension.
Although his personal details were blacked out in the documents released, it appears that he retired at the age of 60.
The up front cost to the state is the €141,722 . But there will be a further long-term cost to the taxpayer because the official's annual pension was boosted by 29pc by the top-up and will have to be paid for life.
The added payment was finally approved in 2009 because the Department of Finance allowed the Revenue official's previous service in the EU to count for pension purposes.
And it warned the Revenue that it had to make changes to its administrative arrangements "to ensure there is no recurrence of this case".
The Revenue said it was a "one-off atypical case" that arose where a member of staff claimed pension entitlements for a period of work in the EU.
"Following legal advice and Department of Finance sanction, the entitlements sought were granted," it said.
However, the Revenue did not say whether the official was employed by the State to work in the EU or worked with another body in the EU.
It said its staff were generally entitled to purchase added years if they did not have 40 years service at the end of their working life.
"In this case however, because of the unique and exceptional circumstances, €141,722 was paid in respect of the purchase of service for superannuation purposes," it said.