Financial Times FT.com

Whitehall cover-up on pension payoff

By Sue Cameron

Published: July 15 2008 20:11 | Last updated: July 15 2008 20:11

So, Paul Gray, the top official who carried the can when Revenue and Customs lost discs containing half the nation’s bank details, appears to have hit the jackpot. You will recall that Mr Gray stood down last November amid speculation as to whether he went voluntarily or was pushed to save the faces of ministers. Now it emerges that when he reaches 60 next month he will have one of the biggest pension pots in Whitehall – plus a hefty extra top-up to sweeten the pill of having to stand down.

This week, publication of the Revenue’s accounts reveal that Mr Gray will have a pension pot of more than £2m. At least 75 top civil servants have pension pots worth more than £1m but only a handful have reached the magical £2m. To be fair, Mr Gray’s pot would have been huge even if he had not stood down. Yet the fine print suggests that despite leaving under a cloud, Mr Gray received extra payments of just more than £250,000. These include a lump sum of £137,591 (in addition to his normal pension package) plus monthly payments totalling £49,292 to take him up to his 60th birthday. Most significant of all, buried in the footnotes, we learn he is to receive an extra £2,685 a year in retirement. It may not sound much but it is worth an additional £70,000 in his pension pot. Why?

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