The retirement pensions of Labour Cabinet ministers will cost almost €15m, the Sunday Independent can reveal.

Labour leader and Tanaiste Joan Burton and seven other current and former Labour ministers are sitting on pension pots of up to €2.5m each.

The retirement funds of those ministers and ex-ministers - including Brendan Howlin, Jan O'Sullivan, Alex White, Alan Kelly, Ruairi Quinn, Pat Rabbitte and Eamon Gilmore - are in sharp contrast to half of 35 to 45-year-olds, who do not have any pensions.

Based on Leinster House and Department of Expenditure pension guidelines, departing TDs or ministers or those who fail to get elected are entitled to a generous and extensive programme of retirement payments funded by the taxpayer.

Expand Close TEA-TOTALLERS: Eamon Gilmore and Pat Rabbitte enjoy some light refreshments at the Labour Party think-in at the Abbey Hotel, Roscommon, last week / Facebook

Twitter

Email

Whatsapp TEA-TOTALLERS: Eamon Gilmore and Pat Rabbitte enjoy some light refreshments at the Labour Party think-in at the Abbey Hotel, Roscommon, last week

These figures are based on the Government running its full term until April next year and on the ministers and former ministers concerned not returning to the Dail.

When Fine Gael ministers are included, the cost of providing pension pots for the Cabinet is set to exceed €30m, based on estimates.

While Labour ministers are set to do well in retirement, their pensions are considerably lower than those paid to members of the last two Fianna Fail-led governments. The cost of funding the pensions of those administrations is almost €50m.

A November 2014 report by pension experts Mercer found that, due to the "impact of the recession", 50pc of all 35 to 45-year-olds have no private provision for retirement.

With Labour languishing on single-digit opinion poll support, there is doubt that many Labour ministers will hold seats in the election. Others - such as former education and finance minister Ruairi Quinn - have already signalled their intention not to stand at the next election.

According to the figures compiled using official guidelines, Ms Burton, were she not returned to the Dail, would be entitled to a pension pot worth €2,569,635 generating a TD's pension (€43,629) and a ministerial pension (€42,025) a year. On stepping down, she would also receive a tax-free lump sum of €130,887.

But even before she receives any of the pension payments, Ms Burton, like all retiring or defeated TDs, receives a termination lump sum worth up to two months' salary. Based on the current TD salary level of €87,825, this would mean she would receive €14,543.

But, Ms Burton, first elected to the Dail in 1992, would also receive the maximum level of termination payments for the first year after she left the Dail: for the first six months, she would receive a monthly payment of 75pc of her salary; for the second six months, she would get a monthly payment of 50pc of her salary. In total, these payments would total €54,528 in the year.

A spokesman for the Tanaiste told the Sunday Independent last night that on taking office the Government reduced the pay of ministers.

"The salaries of Government ministers have been reduced by over 30pc since 2008, which significantly reduces pensions entitlement.

"The Government also increased the public sector pension levy on combined pensions over €100,000 from 12pc to 20pc. TD severance payments are only payable to members who are leaving the Dail and therefore would not apply in these cases.

"No minister can get a pension before pensionable age," the spokesman said.

The self-proclaimed 'Minister for Cuts', Brendan Howlin, would be entitled to a pension fund worth €2,468,520, based on actuarial calculations.

Given his previous stint as Health Minister, he will have accrued nine years of ministerial service by the next election. His fund will generate a TD's pension of €43,629 and a ministerial pension of €38,655 a year. He would also get €14,543 in a termination lump sum and €54,528 in termination severance payments. He would then get a TD's pension lump sum of €130,887, which is tax-free.

Mr Quinn was one of three Labour heavyweights to vacate the Cabinet when the party replaced Gilmore as leader. Between 1982 and 1987, he served as junior minister in the Dept of Environment and then as minister for labour and later as finance minister in the 'rainbow coalition' in the Nineties. He qualifies for the maximum ministerial pension, with a pension fund of €2,573,940 generating a TD's pension of €43,629 a year and a ministerial pension of €42,169.

John Drennan's Guide to Politics - Spring 2015

The next election will change your life. In a special supplement with the Sunday Independent, John Drennan presents his guide to Irish politics.

Mr Gilmore, at 59, is the youngest of the former Labour ministers. Despite a relatively short career as a cabinet minister, he also benefits from being a former Tanaiste and would be in line for a pension fund worth €2,065,329.

On an actuarial basis, given he only served as a junior minister in the rainbow coalition and his three years as Tanaiste, his ministerial pension is based on four years service. Again, he is entitled to the same termination lump sum and payments as Ms Burton. He would also get a TD's pension of €43,629 and a ministerial pension of €25,215 every year.

Former party leader Pat Rabbitte is another heading for a pension fund in excess of €2m. Based on actuarial calculations, Mr Rabbitte would be entitled to a total pot worth €2,046,831. This would generate annual pension payments of €68,227. He would also get a pension lump sum of €130,887 on leaving the Dail.

Communications Minister Alex White and Environment Minister Alan Kelly, given their shorter time in the Oireachtas would be in line for pensions which will cost between €1m and €1.1m to fund.

REVEALED: €14.95m BILL FOR LABOUR MINISTER PENSIONERS-IN-WAITING

Joan Burton:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Tanaiste/ministerial pension (8yrs): €42,025

Total pension pot worth: €2,569,635

Brendan Howlin:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Ministerial pension (9 years): €38,655

Total pension pot worth: €2,468,520

Eamon Gilmore:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Tanaiste/Ministerial pension (4yrs): €25,215

Total pension pot worth: €2,065,329

Ruairi Quinn:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Ministerial pension (10 years): €42,169

Total pension pot worth: €2,573,940

Pat Rabbitte:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Ministerial pension (5 years): €24,598

Total pension pot worth: €2,046,831

Jan O’Sullivan:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €43,629

Ministerial pension (4 years): €21,084

Total pension pot worth: €1,941,408

Alex White:

Termination lump sum: €14,543

Termination payments: €54,528

TD salary pension lump sum: €130,887

Annual TD pension: €21,814

Ministerial pension (4 years): €21,084

Total pension pot worth: €1,286,940

Figures based on Government running full term until April 2016, and those above not returning to the Dail. TDs elected after 2004 have to be 65 to get lump sum, and have to be over 50 to qualify for full pension and lump sum. A reduced pension can be paid to those aged between 45-49 years of age.

Figures compiled by Daniel McConnell based on Houses of the Oireachtas and Department of Public Expenditure Guidelines on pensions for elected representatives.

Sunday Independent