Chief of the Defence Staff's huge £1.1m package from taxpayers

2023-07-25

The million pound Admiral: Chief of the Defence Staff Tony Radakin’s extraordinary £1.1m package from taxpayers last year after huge pension pot hike from his promotion and pay rise

The head of the Armed Forces had an extraordinary million-pound remuneration package last year after a huge pension pot hike and pay rise.

The scale of the boost for Admiral Sir Tony Radakin after he took on the military’s top job in November 2021 has been laid out in the latest Ministry of Defence accounts.

Sir Tony’s pay is listed as £275,000 to £280,000 in 2022-23, up from £265,000 to £270,000 the previous year. He did not receive any bonus.

However, the Chief of the Defence Staff – who has been overseeing the response to the Ukraine crisis – did get the equivalent of £96,700 in benefits, such as accommodation and an official car.

And there was a massive £740,000 upgrade to the valuation of the 57-year-old’s pension pot, reflecting the future cost to the taxpayer of servicing his gold-plated retirement fund.

Sir Tony is now due an index-linked income of £150,000 to £155,000 a year when he retires, up around £35,000 in real terms from 2021-22.

The scale of the boost for Admiral Sir Tony Radakin after he took on the military’s top job in November 2021 has been laid out in the latest Ministry of Defence accounts

Sir Tony is now due an index-linked income of £150,000 to £155,000 a year when he retires, up around £35,000 in real terms from 2021-22

That is comfortably enough to make him a top rate taxpayer.

He has also built up a lump sum payout of £435,000, up around £82,500 in a year.

In total the MoD accounts list his package as worth £1.1million in 2022-23. The pension pot’s CETV – the estimated total cash valuation – is £3.8million.

The massive increase is down to Sir Tony’s promotion from First Sea Lord – with his latest role attracting a salary around £90,000 higher.

His pension pot value had already been raised by £340,000 in 2021-22, partly reflecting his new status.

Sir Tony will not receive any immediate extra payment as a result of the higher CETV estimate.

But there have been mounting concerns about the sustainability of public sector pensions in the long term.

The latest Whole of Government Accounts show public sector pensions are the single largest liability on the balance sheet, worth around £2.3trillion in 2020-21. That was bigger than the national debt at the time.

Amid a wave of strikes, Tories have pointed out that the fact public sector pensions are so much more generous than the private sector needs to be taken into account when considering pay levels.

Under the Armed Forces Pension terms from the time Sir Tony joined, personnel can accrue a pension of up to four-sevenths of their highest annual salary in the final three years of service. There are no contributions and pensions can be taken from age 55, or deferred and actuarily increased.

They are also entitled to a tax-free lump sum worth three times that annual pension.

The scheme was revised and made less generous in 2015.

An MoD source insisted there had been ‘no significant increase in pensions payments to the Chief of Defence Staff role’.

A spokesman for the department said: ‘A number of factors impact on a pension value benefit, including time in post and a change in salary.

‘All pay and pensions figures are subject to external audit before publication.’

Source: Read Full Article