THE DEPARTMENT of Public Expenditure and Reform carried out “no decent analysis” of the cost of staffing implications resulting from public servants taking early retirement, claims Independent TD Stephen Donnelly.
He said a parliamentary reply from Minister for Public Expenditure Brendan Howlin stated the “only estimate of how many would take advantage of the scheme was based on the standard figures for how many retire each year. In other words, they didn’t make any estimate”.
The Wickow and East Carlow TD said it seemed extraordinary that something with such significant implications of cost, staffing and service delivery could be followed through “without any decent analysis done of what the implications would be”.
The Minister said in his reply there was no early retirement scheme. “Many of the retirements at this time are occurring in the normal course where an individual has reached retirement age.”
There were also individuals “availing of cost-neutral early retirement” which had an “offsetting actuarial reduction applied to the individual’s lump sum and pension”.
Mr Donnelly said, “This is like saying I sold my car for €10,000 and bought another car for €8,000 but insisting that I still made €10,000 profit.”
Mr Donnelly asked for a financial analysis, before the February deadline, of the estimated costs of early retirements and replacements. He also asked for a county breakdown of retirements, but the Minister said details of public service retirements on a county basis were not held centrally.
The Minister gave no financial figures but said the numbers retiring were based on a pattern of annual retirements of between 5,000 and 8,000 in any year. “The issue of potential rehiring costs was not considered,” he said.
A department spokeswoman, insisting there was no “scheme”, said when pay cuts were introduced in 2010 there was “always a deadline when the pay cut would hit pensions”. She said 87 per cent of people had “full service of 40 years and were due to retire within the next 18 months”.
The remaining 13 per cent were in their late 50s and would retire on “actuarially reduced pensions”.
Mr Donnelly said the Minister announced last week there “hasn’t been that big a spike in the numbers retiring but if that’s the case we paid out a whole load of money we didn’t need to”.
The Minister said that in 2010 there were 305,512 public servants, dropping to 297,000 last year. He estimated there would be 294,000 public servants this year, with a 2015 target of 282,500.
