In 2017 the Government agreed the policy on public service pensions in payment for the period to end 2020 as follows:
- An equitable approach must be adopted for the various public service pensioner cohorts who are not only differentiated by amount of pension in payment (determined by grade and service) as heretofore but also by date of retirement (in particular pre and post end February 2012).
- Accordingly for those who retired or will retire post end-February 2012, to the extent that they retired on reduced salaries, they will receive pension increases in line with the pay increases due to their peers in employment.
- When alignment is achieved between pre and post end-February 2012 pensioners, pay increases will continue to benefit pensions in payment.
This approach was intended to deal with the ongoing complexities which arise as FEMPI pay related provisions are unwound. Given that this process of unwinding of FEMPI pay reductions will be ongoing over 2021 to 2022 as per sections 19 and 20 of the Public Service Pay and Pensions Act 2017, the requirement for equitable treatment, as outlined above, continues to arise over this period. Accordingly, and as the Deputy may already be aware, the above arrangements will remain in place to end 2022 in advance of which I will consider the future policy approach on this issue.
The Deputy has specifically distinguished between those who retired before 1 March 2012 and those who retired after that date. Generally, individuals who retired pre-March 2012 will have retired either before the imposition of the first FEMPI pay reduction in 2010 or were protected by the first 'grace period' so their pension does not reflect this reduction. This means that some individuals in this cohort have not been eligible to date for pension increases arising from pay increases to serving staff as the salary on which their pension is based is still higher than the salary of serving staff on the same grade/scale point.
As in-service salary scales are restored, more individuals in this cohort become eligible for increases to be passed on to their pensions reflecting the application of the existing policy that there must be an equitable approach adopted for the various public service pensioner cohorts.