Belfast Telegraph

Mandatory cuts 'for little people'

The Government has been accused of being left to write Dear John letters in an attempt to cut high pensions paid to former bankers and ministers.

Sinn Fein deputy leader Mary Lou McDonald said mandatory cuts were only for "little people" and claimed home help hours could be slashed while big remuneration packages for retired executives cannot.

Allied Irish Banks (AIB) is in the process of writing to a number of former senior executives urging them to volunteer to a pension cut.

On Tuesday night, former chief Eugene Sheehy, who resigned in 2009 following the banking crisis, agreed to cut his pension package. It drops to 250,000 euro a year.

"That's the kind of money that the average citizen would see if they were lucky enough to win the Lotto," Ms McDonald said.

The Dublin Central TD accused the Government of being able to cut home help services but powerless to act on bankers' pensions.

"You can simply write them a Dear John letter in the hope that they will voluntarily take a cut," she said.

Taoiseach Enda Kenny, who has described bankers' pensions of more than 500,000 euro as truly extraordinary, said cuts could not be unilaterally imposed due to constitutional rules on property rights.

"We've made the point about premium payments and bonuses and the matter of taxation is a matter for the Government to determine in respect of drawing up a budget for 2013," he said. "And it's not for the Minister of Finance to say this is what pensions are going to be."

AIB has been bailed out with 21 billion euro. It is in the process of completing a redundancy programme to shed 2,500 jobs and reduce its branch network.


From Belfast Telegraph