Tuesday, 11 June 2019

Questions (202)

Jackie Cahill

Question:

202. Deputy Jackie Cahill asked the Minister for Public Expenditure and Reform if the lump sum a person (details supplied) received on retirement from the public sector in 2015 was a lesser amount due to FEMPI; if so, if and when the person will receive the difference as part of the unwinding of FEMPI; and if he will make a statement on the matter. [24221/19]

View answer

Written answers (Question to Public)

I would advise the Deputy that I cannot comment on the details of the case covered by the question as the particular public service pension scheme involved has not been specified. However, I would note in that regard that while I have administrative responsibility for the Civil Service Pension Schemes, I exercise a central policy/authorisation role in relation to all other public service pension schemes.

I will comment on the general point raised by the Deputy.

Public servants who retired from March 2012 onwards had the FEMPI (No. 2) Act 2009 pay reductions reflected in the salary rates that were used to calculate their pension benefits. However, in accordance with the protection known as the second 'grace period', they did not have the FEMPI 2013 reductions (imposed on 1 July 2013 on public servants on annual remuneration above €65,000) so reflected, even if those reductions were imposed on their salaries while serving. Accordingly, for a public servant who retired after implementation of the FEMPI 2013 pay reductions (assuming he or she was affected by those reductions), his or her retirement pension and lump sum were calculated not on the basis of the lower salary rates in payment to serving employees at the date of his or her retirement but on the salary rates in payment on 1 January 2010.

Section 6.2 of the Public Service Stability Agreement 2018 - 2020 (PSSA) committed the Government to adopting an equitable approach to various public service pensioner cohorts differentiated by date of retirement, in the context of the resumption of pay parity for the duration of the PSSA.

Thus, for public servants retiring from 1 March 2012 onwards, to the extent that they retired on FEMPI reduced salaries when compared with public servants who retired from the same grade/payscale point before that date, they will receive, for the duration of the PSSA, pension increases in line with the pay increases due to their peers currently in employment.

In accordance with normal public service pension arrangements, retirement lump sums are calculated on the rates of salary that a public servant is in receipt of at time of retirement (with the exception of the 'grace period' protection I have described above). There is no provision to review historical retirement lump sum payments in the context of the unwinding of FEMPI.