It is understood that the measure to which the Deputy's question refers is the Public Service Pension Reduction (PSPR), which came into effect on 1 January 2011 by way of the Financial Emergency Measures in the Public Interest Act 2010, and which has since been amended via the Financial Emergency Measures in the Public Interest (Amendment) Act 2011 and the Financial Emergency Measures in the Public Interest Act 2013.
PSPR reduces the value of qualifying public service pensions. It is a progressively structured imposition, and as such takes account of the position of persons in receipt of modest-sized pensions. Specifically, the progressive structure of PSPR is evident in the fact that all pensions below €12,000 are exempt from PSPR, while pensions below €32,500 are exempt from a PSPR increase/extension legislated for in 2013 via the Financial Emergency Measures in the Public Interest Act 2013. In addition, for those pensions which are affected by PSPR, the reduction is proportionately greater for higher-value pensions than for lower-value pensions. The following table illustrates the impact of PSPR on a sample of public service pensions awarded on or before 29 February 2012.
|
Pension before PSPR (€)
|
Annual Reduction (€)
|
Annual Reduction (%)
|
|
12,000
|
0
|
0
|
|
20,000
|
480
|
2.4
|
|
30,000
|
1,260
|
4.2
|
|
40,000
|
2,880
|
7.2
|
|
60,000
|
5,280
|
8.8
|
As the Deputy will be aware, I am required to review the Financial Emergency Measures in the Public Interest Acts 2009-2013 annually and cause a written report of my findings to be laid before each House of the Oireachtas. As part of that review I consider whether the various measures, including the PSPR, continue to be necessary, having regard to the purposes of the legislation. In my most recent report laid before the Houses of the Oireachtas in June 2014 I concluded that the continuation of the PSPR remained necessary.
However, as the economic and fiscal conditions move towards a more sustainable position, I believe it will be necessary to prepare for an orderly wind-down of the financial emergency legislation. In this context, and as I have previously indicated, it would be my intention, as a matter of priority and at the earliest date economic progress permits, to move towards reducing the burden of public service pension reductions, with the initial focus on the people in receipt of low pensions.
