Sometime before lunch on December 23rd Minister for Public Expenditure and Reform Michael McGrath quietly abandoned long-held traditions that have governed pay for top officials.
Speaking to Martin Fraser, the State's highest-ranked civil servant, McGrath said that the next person to run the Department of Health would earn €292,000 a year, far above every other mandarin, including Fraser.
The outlines of a deal to boost the salary by nearly €80,000 a year for the job were sketched out in October ministerial talks, but McGrath’s final approval was needed before recruitment could begin.
This week the State's most high-profile civil servant, Robert Watt, the former secretary general of the Department of Public Expenditure and Reform, got the job. If many did not know his name before, they do now.
In a much-shared video of a Dáil contribution, Sinn Féin leader Mary Lou McDonald lambasted the pay rise, declaring it “a stroke”: “There was no process, no rationale for this obscene pay hike.”
Mocking Ministers’ declaration that it was needed to “attract the best and the brightest to apply”, she said: “But, lo and behold, the best and brightest were there all along, under your very noses.”
Highlighting Watt’s virtues as “a senior, experienced, public servant”, Taoiseach Micheál Martin said the selection was independently made: “You shouldn’t cast aspersions on the individual, implicitly, as you do.”
Joining Tánaiste Leo Varadkar and Minister for Finance Paschal Donohoe, he defended the appointment and the process leading to it, prompting questions about why they have invested so much political capital in a decision so easy to attack.
Fine Gael’s parliamentary party meeting heard concern about the “optics” of the pay rise, while Varadkar said he hoped Watt’s decision to waive a portion of the salary would take the sting out of the issue.
Proposed salary
Watt – who has been secretary general at the Department of Health on an interim basis since January – immediately said he would waive the €80,000 salary increase, at least for now.
“The proposed salary for this role is higher than my current salary. I don’t think it is appropriate to take such an increase in pay given the current difficult economic conditions the country faces,” he said.
“It had always been my intention that, if I were to be appointed to this role, I would waive this increase until the economy begins to recover and unemployment falls,” he added.
However it will be up to him, and him alone, to decide when that changes.
The vacancy for the top Department of Health post arose when Jim Breslin, secretary general during Simon Harris's tenure as minister, departed to rejoin his former boss in the newly created Department of Higher Education.
Breslin's departure left the newly appointed Minister for Health Stephen Donnelly needing to find a highly qualified replacement to fill one of the toughest jobs in the State during a pandemic
Meanwhile, Watt’s time in the Department of Public Expenditure and Reform was due to end in April after a decade there in the top role. And he was thinking about his next move.
His name has often been linked to the top job. He once unsuccessfully applied to become Central Bank governor, while in September 2017 he was tipped for a time to become the next Garda Commissioner.
Donnelly rated Watt highly, wanted him badly and the Taoiseach’s Office, which was monitoring the Department of Health’s performance closely and constantly and not always happy about what they saw, approved. So too did Varadkar.
Fraser, the powerful secretary general of the Department of the Taoiseach, was close to Watt and similar in outlook, believing that reform is necessary and that confrontation is sometimes necessary to bring it about.
But would he do it? Of a large number of senior officials who spoke about Watt’s appointment this week, nobody thought his selection was a bad idea, which is not unremarkable in a world where personal enmities can run deep.
Sceptical interrogations
The direct approach of the sometimes abrasive Watt might be just what was required in the creaking Department of Health, resplendent though it may be in its new Baggot Street HQ, several thought.
Others, however, relished the thought of Watt going with his Minister to look for more money every year and being subjected to the same sceptical interrogations that he used to dish out to health and other departments.
Intelligent, gregarious and good company with friends, Watt, who has an unusually high public profile for a civil servant, is popular with close colleagues. In the wider civil service he is respected, though not universally loved.
The issue is not the man, however, but the pay. Even internally within the Civil Service the reaction to the rise has been hostile. Some people express anger. Others, resentment. Others still, “disgust”.
Another former official said the “brazenness” of the rise – made to Watt, not requested by him – was incredible. “Are we to infer that he would not have done the job for the existing salary?” he asked.
Is he a smart guy?
Watt could and should have got the salary he enjoyed previously in the Department of Public Expenditure and Reform, the retired official believed. “The question people are asking is was this guy the Ronaldo or Messi of the public service who’s so brilliant you had to pay an extra €80,000 to hold on to him?
“Is he a smart guy? Absolutely . . . Smart and arrogant, as a lot of smart people are. Was he the only guy that could do this job? No, I don’t accept that at all,” said the former official, voicing the views of others.
“Having endured his lectures for years, now we see him get this massive salary,” said a serving colleague. Several pointed to the irony of Watt, for years the one who held the line on spending, receiving such an increase.
Politicians and political staffers worry that the controversy plays straight into the Sinn Féin “insiders and outsiders”. Defending the actions taken, they say Ministers wanted Watt early on, but they may also have feared that he could be tempted by the private sector.
Running a €20 billion budget brings high rewards in the private sector, far higher than anything on offer by the State. “I think they decided he may well be tempted to go into the private sphere, so they decided, ‘let’s make an offer to him he’d have to think about’.”
Before McGrath appeared at the Oireachtas finance committee in February, minutes taken by Fraser of a Ministers' meeting on October 30th were circulated, citing the "particularly challenging" nature of the job.
An open competition under the existing €211,000 salary would attract a field of candidates from assistant secretaries across the civil service, but a higher salary might “attract a stronger field”.
Such an approach is not new, since it was used to fill major roles such as Financial Regulator, Garda Commissioner, Governor of the Central Bank and chief executive of the National Treasury Management Agency.
A salary “below €300,000” was decided upon, though nothing in the document explains how the €292,000 was chosen. From the off, the Department of Public Expenditure and Reform – Watt’s then department – was concerned about the trouble it would bring.
The controversy – manna for heaven for Sinn Féin and other Opposition parties, because it is so simply told – will continue, especially since two high-powered Oireachtas committees insist that the decisions made must be investigated.
