Dáil Éireann Debate, Tuesday - 6 November 2018
227. Deputy Michael McGrath asked the Minister for Public Expenditure and Reform the position on the unwinding of FEMPI cuts to public service pensioners; his plans in this regard; and if he will make a statement on the matter. [44685/18]
Amharc ar fhreagraThe Financial Emergency Measures in the Public Interest Act 2010 (as amended) imposed a reduction on public service pensions (the PSPR) which exceed specified values; pensions below those values are exempt from PSPR.
The PSPR imposition on affected pensioners has been considerably eased, and will be further eased, by legislative changes in recent years, which have already had the following beneficial effects on pension income:
- many pensions previously reduced by PSPR are now paid without any such reduction;
- pensions which continue to be affected by PSPR in 2018 are higher than they were (or would have been) at the “peak” PSPR reduction rates which applied up to end-2015
This substantial easing of the PSPR burden on pensioners is due to changes contained in two laws:
(i) The Financial Emergency Measures in the Public Interest Act 2015 set out a three-stage partial reversal of PSPR, with changes applying on 1 January in each of the years 2016, 2017 and 2018.
(ii) The Public Service Pay and Pensions Act 2017 put in place a further partial reversal of PSPR, with changes due on 1 January 2019 and 1 January 2020. This Act also requires the Minister for Public Expenditure and Reform to make an order, no later than 31 December 2020, setting a date for the complete elimination of PSPR from all public service pensions.
Detailed tables of the PSPR rates applying in 2018, 2019 and from 2020 as a result of these legislated changes are in Appendix 3 of D/PER Circular 02/2018. The following points concerning PSPR liability on public service pensions are covered in those tables. For those who retired before February 2012
- At present (2018), pensions with values up to at least €34,132 are free of PSPR.
- Throughout 2019, pensions with values up to at least €39,000 will be free of PSPR.
- From 1 January 2020, pensions with values up to at least €54,000 will be free of PSPR.
Those who retired after February 2012 or are yet to retire are entitled to a higher exemption threshold which is €60,000.
