The Minister for Finance has appointed Mr Donal McNally as second secretary general of the Department. Mr McNally (48) succeeds Mr Michael Tutty who recently took up the position of vice president of the European Investment Bank in Luxembourg.

Mr Tutty was nominated by Mr McCreevy after former Supreme Court judge Mr Hugh O'Flaherty withdrew his candidacy for the post. Mr O'Flaherty had been nominated by the Cabinet earlier this year, but there was trenchant public and political opposition to the move.

Mr McNally will be the chief architect and overseer of the forthcoming Budget and holds one of the most powerful jobs in the public service.

His role involves responsibility for overall co-ordination and monitoring of the Budget, tax policy, the Finance Bill, economic policy and economic forecasting. He will also take responsibility for the development of the International Financial Services Centre (IFSC).

As second secretary general he will be Ireland's representative on the EU Tax Policy Group and Code of Conduct for Europe.

A career civil servant, Mr McNally has worked in the public expenditure division and held the position of assistant secretary in the Budget and economic division from 1994 until last June. In recent months he has acted as assistant secretary in the corporate services and public expenditure divisions.

Mr McNally joined the civil service in 1969. He moved to the Department of Finance in 1986 working within the banking section.

He was considered one of the strong contenders for the position, which was advertised earlier this month. Applicants were interviewed by the higher level appointments commission. Mr McNally's appointment was then sanctioned by the Cabinet.

From Dublin, he is an economic graduate of TCD and is married with three children.