Figures on public sector pensions

[patslatt]

See Vast majority of public staff have defined-benefit pension - The Irish Times - Fri, Jan 16, 2009

Some of the great benefits supplied by ultra generous Irish taxpayers and their political leaders:

[]A lump sum 1.5 times a final year's salary. That adds maybe 10% to the value of a pension.
[]Pension benefits linked to pay increases of former position. Does any other country offer this? I doubt it.
[]Relatively youthful pensioners in Gardai,teaching and nursing can retire early on full pension at ages of 50,55 and 55 respectively.
[]A teacher can expect a pension of about €32,000
[]Contribution rates of only 5% of salary for civil servants who joined since 1995 are totally inadequate to fund pensions for the top third of salaries eg €32,000 pension of higher executive officer

Estimates are that pensions will increase 50% in the next 7 years,at a time when tax revenues are under great pressure.

[Magror14]

Just don't forget that Public Servants don't get the Old Age Pension on top of their pensions. For many lower paid public servants their pensions will only be a relatively small top up on what they would get on a contributory pension.

Compare that to some private defined benefit pensions which are on top of their State pensions.

[Schuhart]

Compare that to some private defined benefit pensions which are on top of their State pensions.

Erm, are there many folk in the private sector covered by these?

[tic tac man]

Erm, are there many folk in the private sector covered by these?

Well, yes there are. A lot less than used to be the case, but many Bank employees for instance still have defined benefit cover.

[Magror14]

Defined benefit pensions in the private sector are becoming rarer and rarer I'll admit and actually I was thinking about bank employees.

[tic tac man]

See Vast majority of public staff have defined-benefit pension - The Irish Times - Fri, Jan 16, 2009

Some of the great benefits supplied by ultra generous Irish taxpayers and their political leaders:

[]A lump sum 1.5 times a final year's salary. That adds maybe 10% to the value of a pension.
[]Pension benefits linked to pay increases of former position. Does any other country offer this? I doubt it.
[]Relatively youthful pensioners in Gardai,teaching and nursing can retire early on full pension at ages of 50,55 and 55 respectively.
[]A teacher can expect a pension of about €32,000
[]Contribution rates of only 5% of salary for civil servants who joined since 1995 are totally inadequate to fund pensions for the top third of salaries eg €32,000 higher executive officer

Estimates are that pensions will increase 50% in the next 7 years,at a time when tax revenues are under great pressure.

The contributions is really a moot point: the value of the pensions is open to and understood by everybody involved and is a factor in the setting of pay scales. Whether or not it appears on your pay check, it has been a factor in determining your pay.

For the last benchmarking round, the values of the pension was taken to be about 15%. Though this was a very crude average - which misses the fact that the pension of the better off is much more generous than that for lower paid workers - it nevertheless shows that the pension has been assigned a value and that that value is factored in when people's pay is determined.

[euroboy]

What I don't understand is why pensions of former workers are linked to present wage levels.

Wage levels of today are set to cover the costs of living of today, which is predominantly mortgage repayments and house prices, to which the majority of retired civil servants have no concern.

Retired civil servants dont need pensions linked abeit as a percentage of current wage levels, they simply don't have the outgoings of present workers.

Is that way retirement is about, you have no mortgage, you have some savings, you have generous allowances(tv, free travel, esb, phone etc).

[patslatt]

The contributions is really a moot point: the value of the pensions is open to and understood by everybody involved and is a factor in the setting of pay scales. Whether or not it appears on your pay check, it has been a factor in determining your pay.

For the last benchmarking round, the values of the pension was taken to be about 15%. Though this was a very crude average - which misses the fact that the pension of the better off is much more generous than that for lower paid workers - it nevertheless shows that the pension has been assigned a value and that that value is factored in when people's pay is determined.

Was any value attributed to unsackable jobs for life in the public sector,worth anywhere from 12% to 20% of pay depending on long term unemployment levels (including hidden unemployment of social welfare recipients who cease looking for work)?

[Schuhart]

Defined benefit pensions in the private sector are becoming rarer and rarer I'll admit and actually I was thinking about bank employees.

That's pretty much what was on my mind, and I do appreciate you not beating about the bush. (If Brian Cowen adopted a similar approach, our futures would be a little brighter).

Looking at that, there seems to be about 60,000 people employed in the financial sector. Would I be right in saying that not all of those would be getting defined benefit pensions, and that new hires typically find those schemes closed to them. So, on the face of it, it would look right to be thinking about at least closing the public service scheme to new entrants.

[yehbut_nobut]

Just don't forget that Public Servants don't get the Old Age Pension on top of their pensions. For many lower paid public servants their pensions will only be a relatively small top up on what they would get on a contributory pension.

Compare that to some private defined benefit pensions which are on top of their State pensions.

you've got that slightly incorrect - Public servants hired after 1995, pay full PRSI plus superannuation (each calculated as % of gross salary).

Paying full PRSI entitles you to the State Contributory pension. The Public Service pension tops this amount up to 50% of retirement salary. (assuming full -ie 40 years- service)

So someone retiring on 50k will get a state pension of about 22k, while their public sector pension tops this up to 25k. Ie a whopping 3,000 a year. Break out the champaign why don't you?