Taoiseach calls bankers' pensions 'exorbitant'

Taoiseach Enda Kenny has called on retired bank executives to consider the scale of their “utterly exorbitant’’ pensions.

“I consider a pension of €500,000 to be truly extraordinary,’’ he said. “There is a moral responsibility on individuals to deal with that.’’

Mr Kenny said he understood that AIB’s chief executive had written to former senior executives in recent days asking them to make a voluntary decision regarding their pensions.

Hopefully, he added, “they might decide to make voluntary decisions about the levels of the pension they receive’’.

He said Minister for Finance Michael Noonan had set out clearly the legal constraints on him in dealing with the issue. “The position is that these people retired from the banking sector prior to this administration taking office,’’ he added.

It was important to note, said Mr Kenny, that the Government had gone further than any previous government by including all elements of the pay package under the salary cap. The current AIB chief executive, for example, was subject to the cap of €500,000, while the remuneration of the chief executive of the Permanent TSB was also subject to the same cap.

Mr Kenny said that the transfer of €1.1 billion of nominal loan assets to the AIB pension fund was not to fund “the extraordinary and, in my view, utterly exorbitant level of pensions’’ to former senior personnel within the pillar banks.

“It was to deal with the deficit that was going to arise due to the fact that 2,500 people were taking voluntary retirement from the bank,’’ he added.

Mr Kenny said a Government review of remuneration in banks subject to State support was under way.

Sinn Féin leader Gerry Adams called for the introduction of a levy “to recoup the payment of these super-pensions and ensure taxpayers’ money is not used in this fraudulent way’’.

Mr Adams added that the banks involved were being funded by the taxpayers. “That is deeply offensive,’’ he added.