Cost of public sector pensions €100,000 per Irish family?

[patslatt]

According to an article in The Times yesterday, the UK government is completely underestimating the pension liabilities of pensions for public sector workers such as nurses,teachers and the police Cost of public sector pensions estimated at £1.2 trillion The article estimates that these future pension payments are worth £20,000 per head of the UK population in today's money,which is roughly £80,000 for a family of four.

Public sector pensions are on pay-as-you-go. By contrast,private sector plans that provide final salary pensions must invest enough to cover future payments to pensioners,the level of cash infusions being set by pension actuaries.

In Ireland,if we are following the UK approach,the pensions bill may be approaching €100,000 per family. It may take a Brazilian style hyperinflation of hundreds of percents to pay those pensions if they are still indexed to public sector wages twenty five years hence. By then,there will be far fewer workers to carry each public sector pensioner from their pay packets, barring a massive increase in immigration. Maybe half or more of the labour force would need to be non-Irish to make pension payments affordable without gouging the economy. Would Irish people be willing to accept such a level of immigration which would create a multicultural society like,say,California's?

It's time the government faced up to the enormous future public sector pension costs being piled up on future workers. It should start now by abolishing the link of pension payments to public sector pay for existing civil servants and by a switch to defined contribution plans like those in the private sector for all new public sector recruits.

[libertarian-right]

We can all forget about pensions in this country!

"Losses in private pension schemes were highest – at over 25 per cent – in countries such as Ireland, Australia and the US, where the greatest proportion was invested in equities."
OECD warns on pensions crisis

"Irish pension funds lost €27 billion last year in the turbulent global economy"
RTÉ.ie Money: Making your pension pay

A further decrease to our quality of life here, you will work till you drop, thanks FF!

[hopi watcher]

In Ireland,IF we are following the UK approach,the pensions bill MAY be approaching €100,000 per family.
It's time the government faced up to the enormous future public sector pension costs being piled up on future workers.

Amazing how you drift from "if's ands but's" to certainty. BTW, if you want to know what is the factual position in Ireland, do you not think that you would be better served reading an Irish paper writing on the position here?

[Macy]

Public sector pensions actually cost the irish family €0. They are paid from the contributions of current public servants. And that's only likely to change if there's a nonsensical slash and burn of wages and numbers like you and your ilk suggest in 10 threads a day. We are not in the same "pensions timebomb" scenario as the UK.

[DCon]

Public sector pensions actually cost the irish family €0. They are paid from the contributions of current public servants. And that's only likely to change if there's a nonsensical slash and burn of wages and numbers like you and your ilk suggest in 10 threads a day. We are not in the same "pensions timebomb" scenario as the UK.

I very much doubt this is true as Public Sector pensions are both defined benefit (not defined contribution) and are linked to current salary levels (not the salary level upon retirement).

[bobbysands81]

According to an article in The Times yesterday, the UK government is completely underestimating the pension liabilities of pensions for public sector workers such as nurses,teachers and the police Cost of public sector pensions estimated at £1.2 trillion The article estimates that these future pension payments are worth £20,000 per head in today's money,which is roughly £80,000 for a family of four.

Public sector pensions are on pay-as-you-go. By contrast,private sector plans that provide final salary pensions must invest enough to cover future payments to pensioners,the level of cash infusions being set by pension actuaries.

In Ireland,if we are following the UK approach,the pensions bill may be approaching €100,000 per family. It may take a Brazilian style hyperinflation of hundreds of percents to pay those pensions if they are still indexed to public sector wages twenty five years hence. By then,there will be far fewer workers to carry each public sector pensioner from their pay packets, barring a massive increase in immigration. Maybe half or more of the labour force would need to be non-Irish to make pension payments affordable without gouging the economy. Would Irish people be willing to accept such a level of immigration which would create a multicultural society like,say,California's?

It's time the government faced up to the enormous future public sector pension costs being piled up on future workers. It should start now by abolishing the link of pension payments to public sector pay for existing civil servants and by a switch to defined contribution plans like those in the private sector for all new public sector recruits.

Booooorrrrrrrriiiiiiinnnnnnnggg

[birthday]

Public sector pensions actually cost the irish family €0. They are paid from the contributions of current public servants. And that's only likely to change if there's a nonsensical slash and burn of wages and numbers like you and your ilk suggest in 10 threads a day. We are not in the same "pensions timebomb" scenario as the UK.

Public sector payments are paid from contributions of current public servants!!! and anyone else??
Would you like to produce some evidence for this?
You dont happen to be a public servant?

[goosebump]

Public sector pensions actually cost the irish family €0. They are paid from the contributions of current public servants.

They aren't. Firstly, they're are Defined Benefit, which means there is no fund per se and that the bill has to be met from the Exechequer.

Secondly, if the contributions were covering the costs of the pensions, WTF have we put €18bn into the National Pension Reserve Fund over the last 10 years?

[Baron von Biffo]

They aren't. Firstly, they're are Defined Benefit, which means there is no fund per se and that the bill has to be met from the Exechequer.

Secondly, if the contributions were covering the costs of the pensions, WTF have we put €18bn into the National Pension Reserve Fund over the last 10 years?

To pay the state old age pension.

[Macy]

I got it from the Commission on Public Sector Pensions report, but I'm sure posters on politics.ie know best. "The majority of public service occupational pension schemes are financed on a pay-asyou-go basis, with the annual cost of pensions being met from current revenue."

Surely the National Pension Reserve Fund has turned out to be little more than rainy day money for the Government? But anyway, it was to cover Social Welfare pensions as much as potential Public Sector pensions liabilities.