Dáil Éireann Debate, Tuesday - 24 November 2015
80. Deputy Mattie McGrath asked the Minister for Defence the measures he is taking to keep members of the Defence Forces out of poverty, caused by pension related deductions and various changes to tax and pay related social insurance; and if he will make a statement on the matter. [41213/15]
Amharc ar fhreagraRates of remuneration and conditions of employment in the Irish public sector have traditionally been set by reference to relative levels of pay across the various parts of the Irish public sector. In this regard, the level of remuneration in the Defence sector has maintained relativity with the levels available in other related public sector employments. The Financial Emergency Measures in the Public Interest Acts of 2009-2013 and the Public Service Stability Agreement 2013-2016 define current pay policy. I believe that measures contained in the Lansdowne Road Agreement (LRA) and the recently introduced Budget 2016 will be of benefit generally to members of the Permanent Defence Force (PDF).
The LRA proposals apply to all public servants, including members of the PDF, who accept the terms of the Agreement. I understand that members of the PDF who are represented by the Representative Association for Commissioned Officers (RACO) have already voted to accept the LRA proposals. Members of the Permanent Defence Force Other Ranks Representative Association (PDFORRA) are due to ballot on the Agreement in December.
The LRA proposes to increase salaries during 2016 and 2017 in a manner which will disproportionately benefit the lower paid. These benefits come in the form of increases in gross pay in 2016 for those earning up to €31,000 and in 2017 for all those earning up to €65,000.
In relation to the Pensions Related Deduction (PRD), which is commonly referred to as the ‘Pension Levy’, the exemption threshold for payment of the ‘Levy’ will increase substantially during the course of 2015 and 2016 from €15,000 to €28,750 which means that annual income subject to the levy below €28,750 will no longer be liable to the deduction.
In regard to Budget 2016, various measures will be introduced which will reduce the Universal Social Charge (USC) burden on the lower paid through reductions in rates and increases in exemption limits. Budget 2016 also provides for the introduction of a weekly PRSI credit for certain Classes of PRSI whose weekly earnings are between €352 and €424.
The tax implications of the various measures outlined in the LRA and Budget 2016 will vary depending on individual circumstances but the measures are weighted in favour of the lower paid who will receive a disproportionately higher percentage pay increase.
