Brian Lenihan Jnr (Dublin West, Fianna Fail)

I will try to assist the House as much as I can by going through each Member's contribution rather than delivering a general reply. Deputy Bruton commenced the debate by referring to legal advice and his comments were echoed by several Members. The position is that the Attorney General advised that removing the pensions from current sitting Members was vulnerable to constitutional challenge but that a reduction following consultation with the Members would be possible. That is why the relevant Members were written to in that regard. The Government, having considered such correspondence as was received, decided a proportionate reduction of 25% would be possible.

All the interventions of Deputies were useful. Deputies Barrett and Burton illustrated the character of the legal problem involved. When the 1993 scheme was introduced, those who were Members theretofore were not transferred compulsorily but given an option to transfer. The legislation dates from the 1940s. The Attorney General was satisfied that it was possible to make a reduction but that if a percentage were exceeded, it would not constitute a reduction but an actual extinguishment or abolition of the expectation or right in question. For this reason, he advised the Government that a ceiling should apply to any reduction that could be effected in the case of a sitting Member.

Statutory practice in this matter indicates that when the 1993 scheme was introduced, Members on the old scheme, whereby the pension was payable irrespective of age, were allowed to opt into the 1993 scheme or remain in the one they were in. The Attorney General advised that we face grave economic circumstances and that the Government is entitled to make reductions as a consequence, but that it cannot single out one class for a reduction that amounts to an abolition of their rights. This advice flows from the circumstances that obtained the 1990s, as outlined by Deputies Barrett and Burton.

The pensionability of any increment that has already been earned by Deputies, which was raised by a number of Members, is not dealt with in this legislation. It is a matter for the relevant pension scheme. Deputies Shatter and Bruton made the point that there would not be a level playing field in the next election if a Deputy were aware of the fact that, by contesting the election, he or she would lose an accrued pensionable entitlement. Therefore, it is my intention in revising the appropriate schemes to preserve the increment, if earned before budget day, in so far as the pension in concerned. Otherwise, the rights of widows and those who survive a deceased Member in receipt of a pension would be entrenched. This issue will be addressed.

With regard to the review body on higher pay, I welcome very much the comments of Deputy Burton. I agree with her that if we are to consider very substantial economic adjustment, leadership must clearly come from the top. This is why I announced, in the supplementary budget, that we needed a commission on higher level pay. It will examine the pay of senior public servants and also the pay of Ministers.

The key point Deputies Burton and Bruton raised in this regard focused on the basis of comparison. One difficulty with earlier review groups on higher remuneration was that they compared public salaries exclusively to those in the private sector. I have amended the terms of reference on this occasion to ensure comparison to comparable jurisdictions in the eurozone and the United Kingdom.

Deputies and Senators are now within the scope of the review group because there has been for a number of a years a linkage between the salary of a Deputy and that of a principal officer in the public service. I was very determined to preserve this arrangement in the legislation because it is the correct one regarding the determination of Deputies' pay. I would like a similar arrangement put in place-----

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