"No Eligibility for Severance Pay" ... Controversy Continues After Former PM Truss's 44-Day Tenure Ends

Former Prime Minister to Receive 186 Million KRW Annually as Dignity Allowance
Controversy Over Responsibility for Financial Market Turmoil and Amount Exceeding Typical Worker Retirement Benefits
Rishi Sunak, Penny Mordaunt, Boris Johnson Considered as Next Prime Minister Candidates

On the 20th (local time), UK Prime Minister Liz Truss announced her resignation at 10 Downing Street, the Prime Minister's residence in London. Photo by Yonhap News

[Asia Economy Reporter Kim Sung-wook] Controversy is mounting over the retirement allowance to be received by Liz Truss, the former UK Prime Minister who voluntarily stepped down from her position. Truss, who took office on September 6, resigned after 44 days, becoming the shortest-serving prime minister in British history.

According to the BBC on the 21st (local time), Keir Starmer, leader of the UK's main opposition party, the Labour Party, said on the BBC, "He (Truss), who stepped down after just 44 days, does not deserve such money," and added that she should "decline it herself." After stepping down, Truss is also expected to receive an annual allowance of ?115,000 (approximately 186 million KRW).

Ed Davey, leader of the Liberal Democrats, also criticized on UK LBC Radio, "Although the money Truss will receive is nominally an allowance to cover expenses, it is effectively equivalent to a formal state pension and is several times more than what workers receive upon retirement."

The allowance they are referring to is the 'Public Duty Costs Allowance (PDCA).' It is a system that allows former prime ministers to receive compensation from the state for maintaining dignity. It covers costs such as office maintenance, employment of secretaries and staff, and travel expenses for attending events as a former prime minister, which arise due to their special status in public life.

Costs related to parliamentary activities and private life are not covered, and proof of expenditure and amounts must be submitted. Currently, the maximum annual compensation a former prime minister can receive under the PDCA is ?115,000, a figure that has been frozen since 2011. It is known that six former prime ministers in the UK currently qualify for the prime minister's pension.

In addition to the PDCA, retiring UK prime ministers receive a lump-sum retirement gratuity. Since the salary of a minister is ?79,000, the retirement gratuity is 25% of that, approximately ?19,000. Truss plans to retain her seat as a Member of Parliament after stepping down as prime minister, so she will receive a separate salary for that position. The current basic annual salary for a UK MP is ?84,144.

Meanwhile, according to foreign media including Reuters, candidates to succeed Truss as prime minister include former Chancellor of the Exchequer Rishi Sunak, Conservative Party Chief Whip Penny Mordaunt, and former Prime Minister Boris Johnson. Jeremy Hunt, the current Chancellor who reversed Truss's tax cut policies, is reportedly not planning to run.

This content was produced with the assistance of AI translation services.