The Pay Squeeze:TDs and Senators are resisting any further cuts in their pay and expenses despite mounting criticism
A WEEK ago the Oireachtas Commission released a schedule of cuts in allowances averaging 10 per cent for TDs and Senators, effective since the beginning of July.
The statement accompanying it said that the cuts demonstrated “the willingness of Oireachtas members to provide leadership in challenging times”.
In the context of the debate on State spending in the past year, few issues have generated so much public debate and anger as the salaries and expenses paid to Ministers, TDs and Senators.
There was renewed scrutiny of half-hidden benefits. These included the 50 per cent of pensions being paid to TDs and Senators who were former ministers as well as the indefensible anomaly whereby TDs who were teachers – some more than 20 years ago – were entitled to an open-ended leave of absence and could accumulate a full teaching pension and pocket the difference between their teaching salary and that of the substitute who replaced them.
But does the claimed “leadership” add up to the sum of its parts? It is true that the 226 TDs and Senators have taken cuts in line with other public servants. They are subject to the pension levy applicable to all State employees and have also seen their mileage allowances cut by 25 per cent, as has every civil servant.
It is also true that some of the more generous and outlandish expenses have been cut or pared back. However, it could be argued that the reductions are relatively modest and have not done enough to address the perception that politicians were feathering their own nests during the boom years.
Members of the Dáil and the Seanad are paid in two ways. Ministerial salaries and allowances – some of the details of the latter remain opaque – are paid by the Department of Finance. The salaries and allowances of TDs and Senators is administered by the commission, which is chaired by Ceann Comhairle John O’Donoghue, who has been embroiled in controversy surrounding his travel expenses.
About two years ago, a group looking at remuneration for higher public servants approved a salary of more than €300,000 for the taoiseach. However, it was not implemented due to a public outcry.
Following the Cabinet decision to take a voluntary 10 per cent pay cut last October, Taoiseach Brian Cowen’s salary dropped to €257,000, including the TD-salary portion. This fell to €232,572 once the public sector pension levy was taken into account.
Tánaiste Mary Coughlan’s income fell to €220,000 (€199,962 after pension levy), and that of a senior minister, €202,000 (€183,658 after pension levy). The salary of a TD remained unaffected by the cutbacks. The basic salary – before seniority increments – stood at €100,190, dropping to €91,422 with the pension levy.
In the April budget, however, the increments were scrapped for those not already receiving them and none of the 20 TDs who entered the Dáil in 2002 could avail of them.
Another major budgetary measure tackled the issue of ministerial pensions paid to serving TDs. The initial impression was that it would be scrapped in its entirety. However, after Attorney General Paul Gallagher advised that might not be constitutionally possible , because of its disproportionate effect compared to other groups, the pension was cut by only 25 per cent. A number of former ministers had voluntarily relinquished the payment in its entirety.
The serving TD who receives the largest pension is former taoiseach Bertie Ahern. He is entitled to an annual payment of €83,250 on top of his TD’s salary, with the reduction in place.
The budget announcements suggested full withdrawal of the entitlements for everybody, whereas the actual change resulted in considerable dilution in both cases.
The third measure was a 50 per cent cut (from €20,000 to €10,000) in additional salary for the 24 TDs who chaired Oireachtas committees and the scrapping of payments to vice-chairs, whips and convenors on the committees. The McCarthy report advocated cuts in public expenditure and also suggested “substantial reductions” in the number of committees, but that has been resisted by the commission.
The matter which has been most controversial is the regime of expenses and other allowances for TDs and Senators. The 226 members have shared some €14.5 million each (an average of €64,000 each) until now.
This has proved to be the most contentious issue, with Oireachtas members fiercely resisting the recommendations of the Department of Finance, the McCarthy report and some members of the commission’s own audit committee.
The McCarthy report queried the fact that TDs enjoy the highest mileage rate irrespective of how they travel. There have been instances in the past of TDs charging the full mileage rate even though they availed of pensioners’ free travel on trains. It also concluded that the party leader allowance of €41,152 paid annually to independent TDs should be scrapped.
The report also recommended a reduction in the number of TDs and a re-examination of the Seanad. It also suggested a change in geographical limits for overnight expenses. Presently, any TD who lives more than 24km (15 miles) from Leinster House can claim an overnight allowance. The McCarthy report said it should be raised to 48km (30 miles).
Some TDs who serve on committees argue they will suffer losses of up to €30,000, but for most it will be less than that.
Moreover, it can also be argued that the measures correct the exceptionally generous payment regime that has built up over the past decade or more.