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Pension Provisions

Dáil Éireann Debate, Tuesday - 30 January 2018

Tuesday, 30 January 2018

Ceisteanna (261)

Michael Noonan

Ceist:

261. Deputy Michael Noonan asked the Minister for Education and Skills if a person (details supplied) is eligible to purchase additional pensionable years; if so, the conditions or options for such purchase; if they purchase the additional years the estimated additional and pension entitlement of the pension if they retire at the end of 2018 or if they continue to work until their compulsory retirement date; and if he will make a statement on the matter. [4553/18]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Education)

The person in question is a member of the staff of a primary school. 

She is currently in pensionable service, however she has several years of earlier service which, while not pensionable when given, may reckon for pension purposes on payment of appropriate contributions at any time up to retirement. The amount of the contributions is determined based on salary rates applicable at the time of payment for the service.

Some years ago the person was provided with the then cost of purchasing the service. The Pension Unit of my Department will write directly to the person in the coming week to provide her with a revised quotation based on her current salary and will outline the options for payment which includes an option to make the payment at retirement by deduction from the retirement gratuity. In addition, an estimate of the pension and lump sum benefits that would be payable on retirement, in the event that she purchases the earlier service, will be provided.

Apart from the option to pay contributions to reckon the earlier worked service, the pension scheme provides for purchase of notional service at full actuarial cost to enhance the benefits payable at retirement. Where a scheme member will have between 20 year and 40 years pensionable service by age 65, s/he may purchase any amount up to the difference between potential service to age 65 and 40 years.

When the person received the quotation for the buying back the earlier non-pensionable service and considers her options in that regard, she may, if she wishes, in addition, opt to purchase notional service. At such time my Department will, on request, provide her with a notional service quotation. A quotation for the purchase of notional service may only be provided once the decision of the person as regards paying contributions for the earlier service is known. It is important to state that the cost of purchasing notional service is significantly more expensive than the cost of buying back the earlier non-pensionable service.

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