PENSION RESERVE FUND:THE STATE's payments into the National Pension Reserve Fund are "not justified at a time of huge public borrowing and should be suspended", the report recommends.
Suspending the payment of 1 per cent of Gross National Product (GNP), a sum of approximately €1.7 billion in 2009, would reduce the exchequer’s borrowing requirements at a time when the cost of borrowing by the State has increased, it states.
Minister for Finance Brian Lenihan has previously said that the Government was considering the suspension of payments into the fund, which was set up in order to fund public sector and social welfare pensions from 2025 on and is managed by the National Treasury Management Agency (NTMA).
Corporate governance arrangements at the NTMA should be reviewed “in the context of oversight norms across the public sector”, the report suggests.
The NTMA is unusual within the public sector in that it has the capacity to negotiate individual pay rates with staff. Chief executive Michael Somers told the Public Accounts Committee in May that the body paid its 170 staff a total of €19.4 million in 2008 – an average of almost €90,000 per official. A further €8.9 million was paid out in expenses. Mr Somers declined to discuss his salary or the pay of senior staff when questioned by the committee.
The report recommends that the staff of NTMA and the bodies that come under its auspices be reduced by 217 people. The highest number of job cuts should come from the National Development Finance Agency.
