Public sector pensions add up to €129bn over 60 years

The_Honeybadger · 17-09-2010 10:50AM #1

Just came across this,
http://www.independent.ie/business/personal-finance/pensions/public-sector-pensions-add-up-to-euro129bn-over-60-years-2339341.html

Can anybody shed some light on how we will manage this, along with funding current spending and servicing the national debt.

THE State is to shell out €129bn on pensions for public servants over the next few decades, far more than previously estimated.
And despite civil and public servants having to pay the controversial pensions levy, it effectively costs the Exchequer up to one-fifth of a public servant's annual salary to provide them with a pension.
The Comptroller and Auditor General (C&AG) estimated the cost of funding the pensions of public servants, and concluded there had been a 7.4pc rise in the cost of paying such pensions.
Pay cuts for civil servants have reduced the overall pensions bill, but this is outweighed by a sharp increase in the number of pensioners in the past two years.
The total costs of providing pensions for teachers, gardai, nurses, prison officers, civil servants and local authority workers has jumped from €116bn last year to €129bn.

gleep · 17-09-2010 10:53AM

mickeyk wrote: »

Just came across this,
http://www.independent.ie/business/personal-finance/pensions/public-sector-pensions-add-up-to-euro129bn-over-60-years-2339341.html

Can anybody shed some light on how we will manage this, along with funding current spending and servicing the national debt.

We can't

RichardAnd · 17-09-2010 11:11AM

You're right, we can't and we're not the only ones. Before this decade is out, there will be a pension crisis and it will be one hell of a mess to fix. For the younger people in this country and many others, the only option is to save more throughout your working life because when I hit my 70s, I firmly believe there will be no state pension there for me.

ardmacha · 17-09-2010 12:00PM

There is a touch of shock horror about this thread that reflects the poor journalism of the original article. If the headline had been "pensions for 17% of the workforce to cost 1.5% of GDP" it wouldn't have fitted the agenda. The cost of pensions last year has gone up because people are being encouraged to retire, this increases the pension cost as a proportion of payroll, but still reduces overall public expenditure. Lastly of all European countries Ireland is in one of the best positions to manage pensions, albeit with measures such as an increase in the retirement age, because we have a younger population.

Citizen_Cutback · 17-09-2010 02:47PM

mickeyk wrote: »

Just came across this,
http://www.independent.ie/business/personal-finance/pensions/public-sector-pensions-add-up-to-euro129bn-over-60-years-2339341.html

Can anybody shed some light on how we will manage this, along with funding current spending and servicing the national debt.

Public servants employed since 1995 pay PRSI and are entitled to a state pension in addition to a public sector pension. The state contribution is €230 a week for those who have made sufficient PRSI payments.

What about the cost to the state of the approximately 400,000 current recipients of Contributory/Non-Contributory Pensions and future costs of these payments to non Public Servants? These pensions also cost almost €230 each per week. Why doesn't the C+AG produce an estimate of these costs? They are likely to be a higher figure!

Please also note that the figure of €129 billion is an estimate of the net cost of all Public Sector pensions, if due for payment today, and is to cover payment of these pensions for the next 60 years.

Idbatterim · 17-09-2010 03:06PM

The first thing Id sort out in relation to the pensions for any new Ps staff is that they are going to be getting a defined contribution and not defined benefit scheme! They should scrap the tax free lump sum on retirement too! they have had and will continue to have enough perks, having been a public servant.

Public sector pensions add up to €129bn over 60 years

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