Wednesday, 19 June 2013

Questions (113)

Clare Daly

Question:

113. Deputy Clare Daly asked the Minister for Public Expenditure and Reform further to Parliamentary Questions Nos. 350 and 351 of 11 June 2013, the way the pension related deduction applies to those earning less than €60,000 per annum. [29628/13]

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Written answers (Question to Public)

The public service Pension-Related Deduction (PRD) is an income-graduated imposition on the pay of pensionable public servants. It is imposed in such a way that increasing rates of deduction are applied to increasing bands or slices of an affected public servant’s annual pay. The PRD originally became operative on 1 March 2009 as provided for in section 2 of the Financial Emergency Measures in the Public Interest Act 2009. Soon afterwards, the PRD rates and bands were changed by section 13 of the Social Welfare and Pensions Act 2009. The resultant amended annual PRD rates and bands, which took effect on 1 May 2009 and which continue to apply today, are as follows:

First € 15,000 of earnings: exempt

Earnings between € 15,000 and € 20,000: 5%

Earnings between € 20,000 and € 60,000: 10%

Earnings above € 60,000: 10.5%

Based on these currently applicable PRD rates, the amounts of PRD arising at a series of annual pay points up to and including €60,000 are as follows:

Pay of €15,000: No PRD

Pay of €20,000: PRD of €250

Pay of €25,000: PRD of €750

Pay of €30,000: PRD of €1,250

Pay of €35,000: PRD of €1,750

Pay of €40,000: PRD of €2,250

Pay of €45,000: PRD of €2,750

Pay of €50,000: PRD of €3,250

Pay of €55,000: PRD of €3,750

Pay of €60,000: PRD of €4,250

These PRD money impacts at specified pay levels will, for all annual pay figures at or above €20,000, be €125 less per year with effect from 1 January 2014. This change is due to section 11 of the Financial Emergency Measures in the Public Interest Act 2013, which, effective from 1 January 2014, reduces the PRD rate on the €15,000 to €20,000 pay band from 5% to 2.5%.