Information Circular No 34/2010 – Pension Implications – Budget 2011

By Industrial Relations Officer

The Minister for Finance in his Budget 2011 speech outlined a number of measures in relation to Adjustments to Public Service Pensions:

 Adjustments to Public Pensions:

In relation to Public Service Pensions, the Minister for Finance made the following statement: “Public service pensioners have so far been unaffected by the reductions imposed on serving staff.  The Government considers it appropriate that those pensioners who can afford to should now share the burden of adjustment.  Accordingly, public service pensions above €12,000 a year will be reduced by an average of 4 per cent”.

 Public Service Pension Reforms:      Retired Public Service pensioners (Including personnel who retire before the end of February 2012) will make the following contribution from their annual pensions: 

Annual Public Service Pension (€) Reduction Rate
First 12,000 0% – No Change
Between 12,001 and 24,000 6%
Between 24,001 and 60,000 9%

 

Extension of Retirement Date to End of February 2012:    In relation to extending the “grace period”, the Minister for Finance made the following statement:   “The grace period under which previous salary levels are to be used to calculate pension entitlements was due to expire by the end of 2011.  This is being extended by two months so as to prevent a logjam of public service retirements in 2011”.     

 How Much Will Pensions be Reduced By:   A Private with 31 Years Service on Group 1 Technician Pay has an annual pension of €19,602.45

 19,602.45 – 12,000 = 7,602.45                       7,602.45 x 6% = 456.15

 In this example a Private with 31 Years Service on Group 1 Technician Pay Annual Pension will be reduced by €456.15 resulting in a revised Annual Pension of €19,146.30

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