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Government hands tied over McCarthy €700,000 pension

The Government's hands are tied over a pension package worth more than €700,000 for the state's former top civil servant, Taoiseach Enda Kenny has said.

Mr Kenny vowed changes were on the cards after it was revealed Dermot McCarthy, the ex-secretary general to the Government, received the massive retirement windfall this summer.

Two government ministers went a step further, branding the package unfair.

Mr Kenny said: "We're in a situation were we're caught with that particular deal but I've made it clear that there will be changes in this area for the future and Government will set those out when we make decisions on them, we've been very clear about that."

Mr McCarthy retired this year after 11 years in the position. He was also secretary general to the Department of the Taoiseach and played a key role in social partnership and benchmarking arrangements which reformed the pay and conditions of civil and public servants.

Enterprise Minister Richard Bruton said the system was in need of reform.

"Clearly it is not fair in the way it operates," Mr Bruton said.

"The Government commitment to reform is being worked upon and is absolutely crucial.

"The reform will kick in under the terms of the forthcoming budget, I'm sure it will be included in that package."

But the minister stressed it was not possible to backdate any new laws to change the pension entitlements of retired top civil servants.

"What it will mean for the long term future of pensions commitments will be capped - it will be both fairer and more sustainable and I think that's vital that those sort of decisions are made now."

Junior Finance Minister Brian Hayes said the Government was determined to change the system, but said they could not insist the money be given back.

"But a contract is a contract, it's a legal contract and the only way to deal with that is to have a new system in place and we're intent on doing that," he said.

Fine Gael begins its two-day pre-Dail "think-in" in Galway ahead of the new Dail term next month.

Speakers include Mr Kenny, Finance Minister Michael Noonan, Mr Bruton, the ESRI's Professor John Fitzgerald, and the party's presidential hopeful, Gay Mitchell.

A small number of protesters demonstrating over cuts to education scuffled with gardai and tried to block cars belonging to TDs from getting into the Radisson Hotel, where the think-in was taking place.

A group demonstrating against the downgrading of A&E services at Roscommon Hospital also staged a peaceful protest.