I wish to advise the Deputy that in January 2018 my Department issued DPER Circular 02/2018 authorizing pension increases to qualifying public service pensions of certain public service pay increases, and giving guidance on the implementation of those pension increases. The pay increases involved are those covering the 2018 to 2020 period under the Public Service Stability Agreement (PSSA), as legislated for in the Public Service Pay and Pensions Act 2017. To date, those pay increases consist of: 1% of salary on 1 January 2018; 1% of salary on 1 October 2018; and, finally, 1% of salary on 1 January 2019, in respect of individuals in receipt of annual salaries of up to €30,000.
The principle of pay parity underlies the pension increases sanctioned in the Circular. This means that pay increases agreed as part of the PSSA are passed on to pension recipients to bring the salary on which their pension is based up to the current salary of those still serving after the pay increases are applied. It is important to note that not all pension recipients will be due these increases. This is because of protections in place (known as ‘grace periods’) for public servants retiring after the application of pay cuts under the FEMPI legislation, whereby their pensions were calculated using the higher pay rates that were in effect prior to the application of the pay cuts.
As current salary rates for serving staff are being progressively restored to the pre-FEMPI cut levels, it will mean that for increasing numbers of pension recipients, the salary on which their pension is based will be overtaken by the current salary rates for serving staff, with the result that these pensioners will qualify for pension increases.
It is a matter for the public service pension payroll managers in the various sectors of the public service to implement Circular 02/2018. I understand that work is underway to apply the pay increases I have mentioned to those qualifying pensions in payment that have not yet benefitted from such increases, and that this will include the calculation and payment of arrears as appropriate.