Public sector pensions based on final salaries and indexed to wages are largely underfunded by employee contributions to their pensions in the high salary brackets above about €40,000,a lack of proper funding that will lead to huge future tax burdens.This raises the question,why should private sector employees have to pay increased taxes for public sector pensions that are vastly more generous than those of the private sector?
It would be useful to have extensive public opinion polls on the attitude of the Irish public to such pensions. If the public think the pensions are too generous or that the public sector should fund them fully through increased contributions,then the Croke Park deal on pensions should be scrapped immediately.
The response of the Irish public would likely be negative,judging by news from the US in the article
The Political Rumble Over Public Pension Costs - BusinessWeek
"Seventysix percent of Californians polled in June said public pensions were a big problem or "somewhat of a problem",according to a poll by the Pew Center on the states and the Public Policy Institute of California.In Illinois,83% of the respondents answered the same way,as did 79 percent in New York."
"Six cities-Boston,Chicago,Cincinnati,Jackonville (Fla),Philadelphia and St Paul (Minn)-will run out of pension money by 2020..."
"Already this year,16 states have required public employees to pay more into retirement benefits or cut benefits for new hires...California's new budget...rolls back new hires' pension benefits to 1998 levels."
Quite a contrast to our nearly bankrupt government's Croke Park deal.