Pension deductions

lolly96

Hi, I am currently teaching in a dept of education secondary school and a vec school for the past six months. I am currently paying a pension related deduction, pension grouped and 1.5% sp and ch gros with the dept of education school. With the VEC school I am paying into a pension, spouse and children and a pension related deduction.
I have a few questions I am hoping to get help with. Firstly, should I be paying into all these pensions? secondly, if I should be will I ever see any of this money again? Thirdly and probably the most important what exactly are each of these pensions?
Any information would be greatly appreciated.
Thanks in advance!

Geuze

Typically all public servants pay 6.5% of wages as pension conts.

This is sometimes broken down into three elements on payslips.

1.5% is for the Spouses & Childrens scheme.




Recently, as part of a series of pay cuts, the Govt introduced the "PRD", the Pension Related Deduction.

This is really a pay cut, or think of it as a higher cont for the same pension benefits.

So that means four possible lines on the payslip.

Geuze

lolly96 wrote: »

I have a few questions I am hoping to get help with. Firstly, should I be paying into all these pensions? secondly, if I should be will I ever see any of this money again? Thirdly and probably the most important what exactly are each of these pensions?

The benefits are a pension at retirement and a lump-sum.

Assuming 40 years service, typically the pension is half final salary.

NB: future benefits have been changed for recent recruits.

TheDriver

different prsi class pay different pension rates also but you end up paying roughly the same overall and getting the same at the end.
I believe the ch & sp can be claimed back at the end of your service if you never had either

lolly96

TheDriver wrote: »

different prsi class pay different pension rates also but you end up paying roughly the same overall and getting the same at the end.
I believe the ch & sp can be claimed back at the end of your service if you never had either

Thanks for the info! Just wondering if I should be paying into all these "pensions" in two separate employments?

Pwpane

lolly96 wrote: »

Hi, I am currently teaching in a dept of education secondary school and a vec school for the past six months. I am currently paying a pension related deduction, pension grouped and 1.5% sp and ch gros with the dept of education school. With the VEC school I am paying into a pension, spouse and children and a pension related deduction.
I have a few questions I am hoping to get help with. Firstly, should I be paying into all these pensions? secondly, if I should be will I ever see any of this money again? Thirdly and probably the most important what exactly are each of these pensions?
Any information would be greatly appreciated.
Thanks in advance!

First question: Yes, you should be paying all these.

Second question: You will see some of the 'pension grouped' again - this is your actual pension contribution. How much you see depends on how long you work for. Check out the pension benefits section on the union websites. It can be quite complicated depending on your circumstances.

Third question: Teachers (and civil servants) don't have a pension fund that we pay into. When we retire, the govt pays our pension from current funds. While we work, we pay towards that. The 'grouped pension' is your contribution towards your pension and lump sum. The Spouse and Children's contribution is towards the pension benefit for widow/ers and dependent children of a deceased teacher. This is compulsory for all as a protection for them. The pension related deduction (PRD) is an extra tax/pay cut that teachers must pay because they get a govt pension - as another poster said, consider it as a higher contribution towards the same pension benefits. So, what you're paying into both payslips is actually one and the same thing - your future pension.

By the way, if you leave teaching, make enquiries as to preserving these benefits - i.e. keeping them till you reach retirement age.

lolly96

Thanks for your help! I'm glad I now understand where my money is going.

solerina

Pwpane wrote: »

First question: Yes, you should be paying all these.

The Spouse and Children's contribution is towards the pension benefit for widow/ers and dependent children of a deceased teacher. This is compulsory for all as a protection for them.


By the way, if you leave teaching, make enquiries as to preserving these benefits - i.e. keeping them till you reach retirement age.

This particular deduction makes my blood boil...why are we paying a huge amount of money into an insurance policy (which is what this amounts to) that we never agreed to ??? Surely this should be something optional

spurious

solerina wrote: »

This particular deduction makes my blood boil...why are we paying a huge amount of money into an insurance policy (which is what this amounts to) that we never agreed to ??? Surely this should be something optional

Especially gay people who were not allowed marry anyway. It's like you were going to Spain for a beach holiday and forced to buy skiing insurance.

AFAIK, if you were in before a certain date and were unmarried on retirement, you used to be able to claim it back, but I know I didn't qualify to claim it back and I was appointed (PWT) in 1986, started teaching and paying into it in 1984.
Retired early at the end of December 2013.

Pwpane

solerina wrote: »

This particular deduction makes my blood boil...why are we paying a huge amount of money into an insurance policy (which is what this amounts to) that we never agreed to ??? Surely this should be something optional

I think of it as a charity, as a group support scheme. These schemes were started originally by different groups and professions as Widow's and Orphans' schemes to support those left behind in the case of death. I have never had an objection to it. I cannot see it as anything other than a good thing.

unknowngirl!!

Pwpane wrote: »

I think of it as a charity, as a group support scheme. These schemes were started originally by different groups and professions as Widow's and Orphans' schemes to support those left behind in the case of death. I have never had an objection to it. I cannot see it as anything other than a good thing.

I totally agree and have had first hand benefit of the scheme. My father died at 52, three months after being diagnosed with cancer. This scheme provided, and still provides for my younger brothers until they reach 21, a small fortnightly payment. My mother also receives a payment every fortnight thanks to the scheme.

I can't imagine how my mother would have been able to keep everything going in our home or to put us through university without it. It's not a lot but at a time when you experience such a great loss any gesture like this goes a long way in helping you feel that you can keep going. Knowing you are being supported is a great comfort.

In a strange way I feel pride paying this as I know exactly what the benefits are. I like that I could help some other family who might go through a loss similar to ours.

lolly96

sorry guys another question but do you have to be teaching 40 years before you get your pension? what happens if you leave teaching early? Find it a very long time to be in the teaching profession.

spurious

It's possible to go on a cost-neutral basis after 50. I did it at the end of December. You get a much reduced pension and a reduced lump sum. I will PM you some details.

sitstill

lolly96 wrote: »

sorry guys another question but do you have to be teaching 40 years before you get your pension? what happens if you leave teaching early? Find it a very long time to be in the teaching profession.

Are you sure you actually want to be a teacher?

lolly96

Why? because I want to find out as much knowledge as possible, Its about educating myself for my future.

Geuze

lolly96 wrote: »

sorry guys another question but do you have to be teaching 40 years before you get your pension? what happens if you leave teaching early? Find it a very long time to be in the teaching profession.

Pension is based on (1/80) accrual per year of service.

So, 30yr service means 30/80 pension

Max is 40/80 pension, i.e. 50% of final salary.

Pwpane

Try reading some of this: http://www.asti.ie/pay-and-conditions/retirement-pensions/

It's too much at one go but have a quick look through it all. You'll know broadly what's there and you can go back anytime to check something out. It's actually very important to know the basics.

evolving_doors

Some light reading from the Dept. HERE on pensions for teachers.

solerina

Pwpane wrote: »

I think of it as a charity, as a group support scheme. These schemes were started originally by different groups and professions as Widow's and Orphans' schemes to support those left behind in the case of death. I have never had an objection to it. I cannot see it as anything other than a good thing.

I think in excess of 500 p.a (which is what I am currently paying, I think) is just a bit much to be giving to any charity !!!

spurious

solerina wrote: »

I think in excess of 500 p.a (which is what I am currently paying, I think) is just a bit much to be giving to any charity !!!

Even more so if you can never claim from it.

RH149

spurious wrote: »

Especially gay people who were not allowed marry anyway. It's like you were going to Spain for a beach holiday and forced to buy skiing insurance.

AFAIK, if you were in before a certain date and were unmarried on retirement, you used to be able to claim it back, but I know I didn't qualify to claim it back and I was appointed (PWT) in 1986, started teaching and paying into it in 1984.
Retired early at the end of December 2013.

How can they say you don't qualify to claim it back if you have neither a spouse or children? I have a few single friends in their late 40s who were discussing this recently and as they reckon they won't have children and 'probably won"t marry' they assume they'll get a rebate of their spouses and children payments when they get their lump sum - very unfair if they don't.

solerina

RH149 wrote: »

How can they say you don't qualify to claim it back if you have neither a spouse or children? I have a few single friends in their late 40s who were discussing this recently and as they reckon they won't have children and 'probably won"t marry' they assume they'll get a rebate of their spouses and children payments when they get their lump sum - very unfair if they don't.

It depends on which version of the scheme they are in...I know a recently retired unmarried colleague has claimed it all back, however when I rang the Dept to query this deduction they informed that as I hadn't returned the form to stay in the old scheme (the form came to school apparently, but I never got it) that I was now in the new scheme and would not be entitled to claim it back. I am married anyway so probably couldn't have claimed it regardless....Grr, what a lot of money 'to give to charity' over the course of your career !!

gaiscioch

Geuze wrote: »

Recently, as part of a series of pay cuts, the Govt introduced the "PRD", the Pension Related Deduction.

This is really a pay cut, or think of it as a higher cont for the same pension benefits.

Pwpane wrote: »

The pension related deduction (PRD) is an extra tax/pay cut that teachers must pay because they get a govt pension - as another poster said, consider it as a higher contribution towards the same pension benefits. So, what you're paying into both payslips is actually one and the same thing - your future pension.

By the way, if you leave teaching, make enquiries as to preserving these benefits - i.e. keeping them till you reach retirement age.

Technically, though, do we have any claim on the money we contribute to the PRD, as we have on our proper pension contributions? If you're paid between €20,000 and €60,000 your PRD is a colossal 10% of your gross salary, on top of all your other takes and deductions. If I leave teaching in the morning can I get that 10% PRD contribution refunded?

Here's Brendan Howlin on 30 May 2013 on the PRD's consequence for teachers, commenting in between requesting that his advisors get an exemption on the €92,000 salary cap and instead be paid €132,000:

"The pension related deduction is not a pension contribution. I made this clear when I met the trade unions during the negotiations. They had raised the issue of the pension related deduction or levy, as we call it normally. They made the case that when added to their regular pension contribution, the result was that they would never get the benefit of it. I made it clear that the pension related deduction was part of the financial emergency measures in the public interest, FEMPI, architecture and that it would lapse. It is not a permanent feature and, therefore, cannot be regarded as a permanent contribution to pensions."

solerina

gaiscioch wrote: »

I made it clear that the pension related deduction was part of the financial emergency measures in the public interest, FEMPI, architecture and that it would lapse. It is not a permanent feature and, therefore, cannot be regarded as a permanent contribution to pensions."

This is the bit I would love to see clarification on....is there any chance that is not permanent feature will be removed in the near future ? This is quite a considerable amount of money and I could definitely do with it !!!

TheDriver

i would think this is how they are going to reverse some cuts without being seen to give a pay rise......