Dáil debates

Thursday, 9 December 2010

Financial Emergency Measures in the Public Interest (No. 2) Bill 2010: Second Stage

 

6:00 pm

Photo of Michael NoonanMichael Noonan (Limerick East, Fine Gael)

I move amendment No. 2:

To delete all words after "That" and substitute the following:

"Dáil Éireann declines to give a second reading to the Financial Emergency Measures in the Public Interest (No. 2) Bill 2010 having regard to the proposal to cut the national minimum wage by €1 to €7.65.".

There are three main issues in the Bill as the Minister outlined, first the proposed levies on the pension of public servants who have already retired. The levy is significant and will reduce the pension of retired public servants quite substantially. There is some consistency of approach by the Government and it could be regarded as anomalous that, while the pay of serving public servants attracted the pension levy, the pensions of public servants who had retired did not attract the levy. It is also, I suppose, anomalous that one set of civil servants would retire with a pension calculated on the historical maximum pension and a new set of civil servants would retire with pensions calculated on reduced pensions.

I welcome that pensions of €12,000 per annum are exempt from the levy and that while the levy applies at escalating levels from 6% through 9% to 12%, the Minister did not introduce a flat-rate levy. The average levy overall is an imposition of approximately 4% on people's pensions at the highest level, which is a significant imposition. When taken together with the universal social charge and the income tax changes announced in the budget, public servants on pensions will be significantly worse off than they are today. However, so will everybody else except the super rich in society who pay their tax on a different schedule from the rest of us, proprietary directors of companies and self-employed professionals who are having their emoluments enhanced significantly as a result of the provisions of the budget.

The scope of the levy seems to include all relevant retired public servants including members of the Judiciary. I would be grateful if the Minister would explain the variation in the advice he received on this occasion as opposed to the advice he received in the past that it was not possible to cut the pay of judges. I thought the same would apply to levying the pay of judges to reduce their pay. I understand the position, as the Minister advised us, was that one could appeal to the judges' better nature to voluntarily yield up some of their salaries, but that an imposition could not be imposed because of the separation of powers. I ask the Minister to clarify that matter when replying at the end of Second Stage.

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