Dáil Éireann Debate, Tuesday - 10 July 2012
190 Deputy Stephen S. Donnelly asked the Minister for Public Expenditure and Reform with regard to the Public Service Pensions (Single Scheme) and Remuneration Bill, if he will provide the national employer contributions for the groups listed in the rates of contribution table on page 21 of the Bill, which would be required in a funded scheme with the same employee contributions and benefits; and if he will make a statement on the matter. [33059/12]
View answerThe Comptroller and Auditor General's (C&AG) special study on public service pensions in 2009 estimated the annual pension cost for public servants to range between 10% and 41%. The new scheme will reduce these costs by approximately one-third. The employee contribution in the Single Scheme continues to be 6.5% (3% on pensionable pay and 3.5% on net pensionable pay (i.e. reduced for social welfare integration)), which nets to an average contribution of about 5% of total pay for most public servants.
There is no fund as public service schemes are pay-as-you-go. Employee contributions are actual in that pay is reduced to account for these. Employer contributions are estimated as being that figure necessary to fund the retirement benefits, were a fund to exist, after employee contributions are taken into account.
The C&AG derived employer contribution rates for various categories of staff in his 2009 report — see Table below. Without carrying out a substantial and expensive actuarial exercise, the best estimate is to reduce the employer rates derived by the C&AG below for each category in line with overall one-third reduction and that means approximately a 10% or higher employer contribution in the new scheme for the majority of public servants.
|
Notional contribution rates — post 2005 male entrants (C&AG Report 2009) |
||||
|---|---|---|---|---|
|
Categories from C&AG |
gross contribution rate |
Employee contribution |
Current notional employer rate |
Single Scheme notional employer rate |
|
Established CS |
24.6% |
4.6% |
20.0% |
11.8% |
|
Non-Established CS |
9.5% |
0.3% |
9.2% |
6.0% |
|
Primary Teacher |
20.5% |
4.9% |
15.6% |
8.8% |
|
Post-Primary Teacher |
23.1% |
4.9% |
18.2% |
10.5% |
|
Garda |
29.6% |
5.1% |
24.5% |
14.6% |
|
Prison Officer |
27.8% |
4.5% |
23.3% |
14.0% |
|
Commissioned Officer |
41.2% |
4.8% |
36.4% |
22.7% |
|
Enlisted Personnel |
22.4% |
0.4% |
22.0% |
14.5% |
|
Consultant |
25.9% |
6.0% |
19.9% |
11.3% |
|
Nurse (general) |
17.7% |
4.7% |
13.0% |
7.1% |
|
Established in NCSSB |
22.7% |
4.9% |
17.8% |
10.2% |
