That a sum not exceeding £460,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1963, for payment of Increases in certain Pensions, etc., in respect of public service.
The purpose of this Estimate is to seek the approval of the Dáil for increases in public service pensions. including military service pensions and special allowances, and to authorise payment of the increases with effect from the 1st August next in advance of legislation. The necessary Pensions (Increase) Bill to give statutory authority for the increases will be taken next session.
When introducing the Budget in April last, I adverted to the fact that public service pensions had not been adjusted as frequently as had the pay of serving personnel, even though a number of pensions increases had been given in the post-war period. I had decided to provide a further pensions increase this year to enable pensioners to meet post retirement increases in the cost of living, and a sum of £450,000 was allocated for this purpose in the Budget. I indicated that it was proposed to give priority to those longest retired and to bring all pensioners who retired before the pay revision of the 1st November, 1955, up to the level of their equivalent colleagues who retired with the benefit of that pay revision. The additional estimate now before the House provides for this increase.
Deputies will appreciate that it was not easy to compile an estimate of the cost of this step. There are some thousands of individual pensioners, who had retired at various dates over the past 25 years or so, at various salary points and with varying lengths of service, and it was much more difficult to calculate the amount required to bring each of them to the level of an equivalent 1955 colleague than it was to calculate the cost of previous pensions increases given in the form of percentage additions for various broadly defined classes.
However, I am glad to say that the £450,000 provided in the Budget proved to be adequate, and there was, in fact, a little left over which allows me to give a further increase to the pensioners who have now been brought up to the 1955 level, and as well as this, to give an increase to all the 1955-59 class of pensioners, that is, who got the 1955 pay increase, but had retired before the pay increase which was given in the Civil Service as from the 15th December, 1959, and to other classes on other dates. This further increase will be 6 per cent. and will be given to all pre-December, 1959 pensioners, whether they retired before or after 1955. This second step will cover a good part of the rise in the cost of living since November, 1955, and it should be welcome to the 1955-59 group, whose pensions are now being increased for the first time.
In the case of flat rate pensions, appropriate percentage increases have been determined by reference to increases granted in cognate pensions in relation to pay or cost-of-living movements or other relevant factors. The maximum appropriate increase for these flat rate pensions has generally worked out at about 20 per cent. over the current rates. Special allowances to persons holding military service pensions or Service Medals will be increased by 5s. a week.
The total amount which is being asked for in the additional estimate is £460,000. This is the amount required in the current financial year to meet the payment, as from the 1st August next, of the increases for all public service pensions paid direct to the recipients out of Votes of the Oireachtas. The main classes of pensioners — former civil servants, national teachers, and so on—appear on the face of the Estimate. Local authorities will be empowered to give corresponding increases to their pensioners. Part of the cost of certain local authority pensions, such as vocational teachers' pensions, is recouped by the Exchequer, and the Estimate contains a small provision to meet any claims which may be presented by the local authorities before the end of the financial year. In a full year, the cost of the increases is estimated at approximately £820,000, including a full year's recoupment of the Exchequer share of local authority pensions increases.
The sum asked for is £10,000 more than the £450,000 allocated in the Budget, to enable me to equalise and to round off the appropriate percentages.
I am, of course, very glad to be able to give these increases. Deputies will realise that the superannuation terms provided for public servants by or under the various statutes of the Oireachtas, or under earlier legislation which is still in effect, did not provide for any post-retirement increases in pensions. The Government are, strictly speaking, bound by no obligation or commitment in this respect. What I have been endeavouring to do, in relation to pensions increases, is to disburse whatever money it might be possible to make available, within the limits of Budgetary conditions, to make good the depreciation in the value of pensions caused by the rise in the cost of living. Any future step which it may be possible to take will be in the same direction, subject always to Budgetary considerations.