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Paschal Donohoe says ministers won't take pay cut during Covid-19 pandemic

The finance minister had previously said he would consider actions taken by other governments in terms of pay cuts for politicians.

File photo. Minister for Finance Paschal Donohoe.
File photo. Minister for Finance Paschal Donohoe.
Image: Leah Farrell/Rollingnews.ie

MINISTER FOR FINANCE Paschal Donohoe has said government ministers won’t be taking pay cuts during the Covid-19 crisis.

Two weeks ago, Donohoe had said he would consider the actions taken by other governments in terms of pay cuts for politicians, after New Zealand prime minister Jacinda Ardern said she was taking a 20% pay cut for the next six months.

Speaking to Pat Kenny on Newstalk today, however, the finance minister said his “current plan” was not to make any changes to ministers’ pay. 

He said: “I have not experienced any of the wage increases in recent years that any other public servant, or indeed many politicians, have. 

I didn’t believe at the time and don’t believe now that it would have been appropriate for me to have the wage improvements that are available for many. And because of that my current plan at the moment is not to implement any further changes in that area.

Ministers within the government are paid a basic salary of €96,189 plus an additional salaried allowance of €79,510 a year.

The basic TD’s salary is €96,189.

When New Zealand’s Ardern announced she was taking a pay cut, she said the pay of her fellow ministers and of top public servants would be slashed by a fifth for six months.

The move will see Ardern’s annual pay fall from around NZ$470,000 (€258,000) to NZ$376,000, costing her about NZ$47,000 (€25,000) over the six-month period.

“While it in itself won’t shift the government’s overall fiscal position, it is about leadership,” she told reporters. “This was always just going to be an acknowledgement of the hit that many New Zealanders will be taking at the moment.”

New Zealand is facing dire economic forecasts due to the fallout from Covid-19, as is Ireland.

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At home, there are currently 591,000 people who have received the Covid unemployment payment while 49,000 employers have registered with the temporary wage subsidy scheme.

Donohoe told Pat Kenny that there was “much to be concerned about” the public finances with falling tax revenue and the money being pumped into schemes aimed at supporting people during the crisis.

“But while there is much to be concerned about, there’s an equal amount to be confident and positive about,” he said. 

“We should acknowledge the many people who are still at work, who are creating the income and the taxes that allow that money to be spent. Secondly, if I look at where we were before we moved into this crisis, the quality of our public finances, the diversity of the Irish economy, the flexibility of many employers and those who work for them, I’m absolutely certain those qualities will allow the economy to rebuild over time.”

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Sean Murray

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