With effect from 1 July 2013, the Financial Emergency Measures in the Public Interest Act 2013 will reduce public service pensions valued above €32,500 per annum, applying to all such pensions already payable on that date or awarded up to end-August 2014. The reductions will range from about 2% near the €32,500 threshold level (subject to no pension falling below €32,500), to 5% for the highest pensions. The Act secures the appropriate reductions by revising and adapting the existing “Public Service Pension Reduction” (PSPR) in such a way that:
- revised (higher) rates of PSPR will apply to those pensions above €32,500 which have been subject to PSPR before July 2013 - largely comprising pensions awarded up to end-February 2012, while
- new rates of PSPR will be introduced for those pensions above €32,500 not previously subject to PSPR – largely comprising pensions awarded after February 2012, and up to end-August 2014.
The savings arising from this pension reduction measure are estimated to be €12.9 million in 2013 and €24 million in 2014.