Terence Flanagan
Ceist:152. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform if he will phase out the pension-related deduction; and if he will make a statement on the matter. [3068/16]
Amharc ar fhreagraTuesday, 26 January 2016
Ceisteanna (152)
Freagraí scríofa
The public service Pension-related Deduction (PRD), which applies to the pay of most pensionable public servants, was introduced with effect from 1 March 2009 under the Financial Emergency Measures in the Public Interest (FEMPI) Act 2009. It remains a key part of the overall set of public service pay and pension retrenchment measures legislated over the period 2009 to 2013 in response to the fiscal crisis under the FEMPI Acts.
I am required by legislation to review the FEMPI measures annually. My most recent such review, which was laid before the Houses of the Oireachtas on 29 June 2015, concluded that because of the economic and fiscal improvement of recent years, this Government was in a position to, and intended to, ameliorate some of the FEMPI measures. The amelioration of the FEMPI measures was negotiated and agreed by public service employers with the Public Services Committee of the Irish Congress of Trade Unions representing public servants, under the terms of the Lansdowne Road Agreement. These ameliorative measures are provided for in the FEMPI Act of 2015.
With regard to PRD, the FEMPI 2015 changes are delivering significant income increases to all affected public servants by way of increase of the PRD exemption threshold, to €26,083 from 1 January 2016 and again to €28,750 from 1 January 2017. This two-stage part-restoration will remove some lower-paid public servants from the impact of PRD entirely, while meaning that those who continue to be impacted by PRD will receive an effective annual pay boost of €733 in 2016, rising to €1,000 from 2017, by comparison with the pre-FEMPI 2015 Act position. In addition to the PRD changes, public servants on annual salaries up to €24,000 received a pay increase of 2.5% on 1 January 2016, while those on annual salaries from €24,001 to €31,000 received a pay increase of 1% on the same date. On 1 September 2017 all annual salaries up to €65,000 will be increased by €1,000.
Economic and fiscal progress in the years ahead will determine the scope and timing for further changes to the financial emergency measures, including the PRD.