The feckless five Ministers who resigned from the executive team that drove Ireland into receivership for €85 billion are leaving with pensions worth an astonishing €18 million.

The Star has taken the pension incomes of Dermot Ahern, Mary Harney, Noel Dempsey, Tony Killeen and Batt O’Keeffe and priced these yesterday in the pension market with a leading Irish Life Office. These are the amounts of money an ordinary worker in the private sector would need to save in a pension fund to buy the benefits that these ex-Ministers will enjoy.

Note; Assumes joint life, 50% transfer to surviving spouse of similar age, inflation-proofed capped at 5%. To work back to the starting pension apply the pension rate % to the value of the pension pot.

Because these are priced in the open market, they represent the real cost of these extraordinary pensions. Eighteen million is what the Department for Finance would have to fork out if it wished to guarantee the benefits rather than divvy them out each year from our tax payments. The figures, which do not include tax free cash lump sum payments and termination payments, provide a startling insight into the lavishness of Ireland’s unreformed public pensions model - one now backed by a hugely weakened economy and driven on to the rocks by the very same senior politicians and civil servants who have gained more than any other from these platinum pension packages.

Ministers Ahern, Harney, and Dempsey join Patrick Neary, the former Financial Regulator with pension pots worth over €4 million each – that’s money we all owe them from our future taxes. Neary, remember left in 2009 with a tax free pension lump sum of €428,000, a termination payment of €202,000 and a pension of €142,670 a year that’s  worth over €4million to you and me.

Since public sector pensions are paid out of general tax revenues the overall bill can be hard to grasp but when all the pension promises currently on the clock in the public sector are added together it now stands at staggering €108 billion;

• The National Pension Reserve Fund which was supposed to contain the assets to back this staggering liability has been drained to fill the hole in the banks and to double as Ireland’s forced contribution to the bailout fund.
• If Ireland was a commercial pension fund it would be wound up as insolvent but instead of dealing with the radical reform needed this Government has chosen instead to reward its failed officer class with €18 million worth of benefits from it.
• What’s needed urgently is the capping of pensions at a modest level that leaves frontline workers like garda, nurses, teachers and lower paid civil servants untouched but limits pensions to no more than twice the average industrial wage - above that, higher earners in the public sector should be subject to self-funding and equity market risk like everyone else.
• Both public and private sector pensions need to be replaced by a common universal pension scheme backed by The State and designed to give all contributors a decent retirement lifestyle – but not one which is a king’s ransom or that lavishly rewards executive failure on a grotesque scale.

Eddie Hobbs