Cabinet ministers past and present will have to fork out as much as €30,000 after being overpaid in their pensions in a major clerical blunder, writes Craig Hughes.

Public Expenditure Minister Jack Chambers announced a major review of pension payments yesterday for over 13,000 current and former civil servants and ministers.

The minister, who labelled the errors “unacceptable”, briefed Cabinet yesterday on the “serious and systemic operational issues in the National Shared Services Office” which provides payroll, pension, and finance management services to public bodies.

In one case, a senior civil servant was overpaid by €280,000, while current and former ministers will be forced to repay amounts ranging from “hundreds of euros to the low €30,000s”.

Mr Chambers was first alerted to the issues in March, after which further errors were discovered, including both underpayment and overpayment of pension entitlements dating back up to 20 years.

Some ministers were underpaid and are due refunds “ranging from hundreds of euros up to the low €20,000s”.

The overall cost of the blunder is not yet known, nor is the number of individuals impacted.

Mr Chambers branded the fiasco “completely unacceptable” and said that public confidence in the National Shared Services Office has been “seriously undermined”.

He said: “There’s been a real failure here. The NSSO has responsibility for the essential function of the provision of pay and pensions to public and civil servants and it has failed in this fundamental duty.

“I think there’s a piece of significant work required to restore trust and rebuild confidence.

“When you look at the scale of the serious and systemic areas that have been identified, it undermines confidence.”

Three cohorts are impacted by the errors: current and former ministers and office holders, civil service retirees with work-sharing patterns, and retired senior civil servants.

Mr Chambers added: “The NSSO is commencing a process today to contact ministers to outline the issue to them and to make arrangements for the recoupment of monies owed or to issue refunds as appropriate.”

Senior members of Cabinet were furious last night and questioned how such serious errors could go undetected for so long.

One minister said the mistakes were not the fault of politicians but that they would be blamed for it for the next few weeks.

“It’s frustrating in the mildest sense of it, maddening in the worst sense,” he said.

“We all have to pay this back. How does this go on for the guts of 20 years I am told? Surely there are auditing systems in place?

“It’s good that it was caught, but how did it go on for so long?”

Another said the “optics” are “terrible” as it related to public service pensions for politicians and senior public servants.

It is understood that most of the senior civil servants who were overpaid were assistant secretaries and secretaries general, the two highest positions in the public sector, who earn anywhere between €190,000 and €275,000.

The source added that they are “annoyed” at the matter but said they hope the external audit and review would help re-establish confidence in the system.

They also agreed that it is a bad look that only the work-sharing employees were underpaid, compared to the overpayments to senior officials and politicians.

Voicing their anger at the NSSO, they said it “wasn’t that hard” to get the pension deductions correct, saying schools got it right all the time.

“This isn’t rocket science. This is a dereliction of duty, a massive foul up,” they said.

“It annoys me more, it makes everyone look really bad. It’s not our fault but we will be blamed for it. There will be no accountability which is even more frustrating.

“If I messed this up as a minister, I would be out of a job. But the officials who messed this up won’t get any blame, but we will get it in the neck for the next few weeks.”

Mr Chambers said he would not reveal the level of overpayments made to individual ministers.

He said: “As these are personal matters relating to individual workers’ pay, I am not in a position to disclose individual amounts.

“However, the amounts range from hundreds of euros to the low €30,000s in terms of monies to be recouped.

“A number of ministers are due refunds ranging from hundreds of euros up to the low €20,000s. Some are unaffected.”

One issue relates to the miscalculation and under-payment of pensions for some work-sharing civil service retirees who were in receipt of allowances prior to retirement in the last 20 years or so.

Another issue relates to the incorrect application of pension deductions for most members of the current Government, ministers of state, some members of previous governments and recent office holders.

The third issue relates to the administration of Chargeable Excess Tax and Withholding Tax in respect of senior grade civil service pensions.

In total between those two taxes, the NSSO has identified 30 cases.

The liabilities for this cohort range from a few hundred euros to €280,000.

A scoping exercise is under way by the NSSO to establish the scale of the problem.

A pool of 13,000 retirees will have to be checked although the number affected is likely to be much smaller.

“To be clear, this does not imply that all 13,000 will have anomalies, but all 13,000 will be checked,” Mr Chambers said.

He said he had tasked the NSSO with ensuring that all monies owed to the State are fully recouped and monies owed to individuals are refunded.

Former secretary-general at the Department of Finance, Derek Moran, has been appointed as chair of the NSSO advisory board.

An “external audit” will also be commissioned as will a review of the NSSO’s capacity and structures to ensure that the body is configured and equipped to fulfil its responsibilities.