IRELAND - The government has confirmed former ministers still serving as members of parliament (TDs) and currently in receipt of a ministerial pension will see their benefits cut by 25%.

Brian Lenihan, minister of finance, outlined a number of changes to the remuneration of deputies and senators in the Oireachtas [the Irish parliament] as part of the supplementary budget in April, following concerns about fairness and transparency of costs in the current economic climate.

Lenihan proposed that the current arrangement - which sees former ministers paid ministerial pensions while still serving as a member of the Oireachtas - would be abolished, and in a Cabinet meeting last night it was decided that the arrangement will be removed from the date of the next election.

The government also confirmed that existing Oireachtas members in receipt of ministerial pensions will have their current payments cut by 25%, as legal advice had concluded it "was not constitutionally possible to reduce the pension payment by more than 25%".

The decision follows a consultation with affected members which was completed last week, and it is expected that the legislation enforcing the Cabinet's decision will "pass all stages before the summer recess".

Under the existing rules, former ministerial officeholders who continue to serve as either members of parliament (TDs), senators or members of the European Parliament (MEPs) are entitled to receive half of the pension that they would otherwise be given.

Although pensions are only payable from age 50, a member who served for two to three years could receive a pension of around 20% of salary, which increases 5% for every further year of service, up to 60% for 10 years or more.

The government highlighted that any adjustment of ministerial pensions received by former ministers still serving in the Oireachtas "must be proportionate and just" so a reduction in excess of 25% is not "constitutionally permissible" with regard to the entitlements of those members.

However it noted it is possible to remove the existing arrangements from the next parliament, as "those running for election will be aware that they will not be entitled to receive such a pension while they serve as members of the Oireachtas".

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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