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Ministers seek improved pension terms

UK/IRELAND - Government minister pensions have fallen under the spotlight, as ministers in both the UK and Irish Republic have sought improvements to their financial arrangements.

The Irish finance minister Brian Cowen has slipped additional clauses to a bill -predominantly associated with the official introduction of the EU's Markets in Financial Instruments Directive (MiFID) yesterday (November 1) - and passed by the upper house (Dáil Éireann) earlier this week, which now give MPS the opportunity to claim their retirement benefits two years after becoming an MP, rather than three previously-required three year minimum.

At the same time, a further change has also been added to the Markets in Financial Instruments and Miscellaneous Provisions Bill 2007 which gives government ministers the ability to claim access to their pensions entitlements at any time.

Under the previous terms of the Ministerial and Parliamentary Offices Act 1938, ministers had to claim their right to their pensions payments within six months of becoming an MP, otherwise would only receive payments from the date at which they made their application.

Irish pensions officials note shifting the pensions preservation date from three to two years brings the ministers' pension plan into line with common pensions practice in Ireland.

However, the move to give ministers the ability to claim back-dated pensions entitlements only applies to ministers and not to other local government employees and civil servants.

And in the UK, former Lord Chancellor Lord Falconer is said to be preparing to sue the office of prime minister Gordon Brown for what he believes should be a six-figure, or double the £52,000, pension he currently receives.

When Falconer took up his post as Lord Chancellor in 2003, he was officially entitled to a salary and pension package exceeding other Cabinet ministers, including the prime minister, but chose to receive the standard £104,000 deal Cabinet ministers based in the House of Lords usually receive.

Officials at the Cabinet Office have refused to comment on the situation and could not clarify which department Falconer may technically sue, reiterating only an earlier statement from the government.

Responding to a written question from shadow minister Oliver Heald, the then prime minister, Tony Blair, stated on June 19 2003 the Secretary of State for Constitutional Affairs had "elected to receive only a salary and pension equivalent to that received by other Secretaries of State in the House of Lords" even if his office of government were abolished.

If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email julie.henderson@ipe.com

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