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Government to reverse some Public Secor Pay cuts

Brussels Sprout

Labour party minister Brendan Howlin announces that some of the Public Sector pay cuts implemented over the past number of years will be reversed. No details of which ones or when exactly this will happen.

Minister for Public Expenditure Brendan Howlin has said some pay and pension cuts in the public sector will be reversed as exchequer finances improve.

Mr Howlin said talks with unions will begin next year, but it is not clear when exactly such measures might come in.

Public sector union IMPACT has welcomed the comments saying pay must move as the economy recovers.

Is there really any merit for this at a time when the budget is still being adjusted to try and make expenditure match income?

Is this a political stunt by the Labour party in the runup to the 2016 general election to match Michael Noonan's talks about cutting income tax?

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mirrorwall14

Sheldons Brain wrote: »

The usual deliberately misleading posting that seems to characterise these things.

A teacher will receive a lump and then half of their salary less the OAP. This is more like 15K. Simplifying things is one thing but ending up with a figure two and half times the actual figure is either grossly incompetent or malicious. Which is it?

The OAP miscalculation drives me absolutely batty as it is so often done deliberately. Almost everyone except public servants get 12k a year on retirement for PRSI contributions (I believe). Public servants pay PRSI like everyone else but this 12k is included in the pension calculation and then our pensions are vilified as too expensive, people aren't contributing enough etc etc!

antoobrien

mirrorwall14 wrote: »

The OAP miscalculation drives me absolutely batty as it is so often done deliberately. Almost everyone except public servants get 12k a year on retirement for PRSI contributions (I believe).

Wasn't that changed in '95 when the PRSI charged to (most) PS workers was changed?

Gumbo

antoobrien wrote: »

Wasn't that changed in '95 when the PRSI charged to (most) PS workers was changed?

Post 95 PS pay the full rate of PRSI.

antoobrien

kceire wrote: »

Post 95 PS pay the full rate of PRSI.

I know that, the question is are they (post 95 PS employees) also entitled to full contributory pension?

The relevant DSP page seems to indicate that, subject to having enough service, they would be.

barneystinson

antoobrien wrote: »

Wasn't that changed in '95 when the PRSI charged to (most) PS workers was changed?

Yes, and now people hired post-95 are paying full Class A PRSI, and their DB pension includes the State pension, which a private sector scheme doesn't.

antoobrien

Sheldons Brain wrote: »

A teacher will receive a lump and then half of their salary less the OAP.

Would I be correct in assuming that the difference between the pre and post 96 pension scales is the payment/non-payment of the contributory oap?

ardmacha

creedp wrote: »

In summary, public servant should never again receive, nor deserve, pay increases!

But they should get bigger pay decreases than everyone else, of course.

antoobrien wrote: »

I know that, the question is are they (post 95 PS employees) also entitled to full contributory pension?

The relevant DSP page seems to indicate that, subject to having enough service, they would be.

Of course they are entitled to the full OAP, isn't everyone else with 40 years contributions?
The question is surely what pension they receive as employees and the deliberate misrepresentation of same.

Paulzx

antoobrien wrote: »

Would I be correct in assuming that the difference between the pre and post 96 pension scales is the payment/non-payment of the contributory oap?

The Contributory OAP effects pre 95 and post 95 employees differently.

Taking the example of a retiring public servant with 40 years service and a final salary of 50k.

A pre 95 employee retired on a pension of 25k which was paid by the dept he retired from i.e Cork County Council. He paid a D prsi contribution which gave him no entitlement to the Contributory Old Age Pension. However, in the past many retirees took up further employment and then paid an A Prsi contribution which if they certain criteria could entitle them to a full or a portion of the Contributory Old Age pension in addition to their Occupational one.

This system changed in 1995 to stop this.

Now the same employee pays a full A prsi contribution in addition to their Superaanuation contribution. Upon retiring they receive a pension of 25k which is made up of 13k occupational pension and 12K State Contributory pension.

Every employee in the state pays A prsi and therefore has an entitlement to the 12K state pension once they have enough contributions.

Mongfinder General

Tim Robbins wrote: »

You get a defined benefit pension. That's worth a lot more than 10% of your salary.

I won't get anything with the way demographics are shaping up. I am paying into 2 compulsory pension schemes as well as a pension levy. I would prefer to be taxed like a regular "PAYE worker" and allowed to make my own investment decisions. I do not want to pay into a PS pension scheme because there will be nothing left in them when I retire!

luckyboy

You often see references to the "bumper" pension packages of high-ranking public servants or politicians when they retire or leave office. Example: a person retiring from a €150k pa post receives a lump sum of €225k and a pension for life of €75k pa. Such a person is said to have a pension pot worth €1.725m. This is worked out by adding the lump sum to 20 x the annual pension amount. Moving down the scale, a teacher retiring on €60k who gets a €90k lump sum and a €30k pension is said to have a pot worth €690k etc etc, the inference being that all public servants have a Rolls-Royce pension.

Well, flip this on its head a little and consider the following. Every person who qualifies for the full contributory OAP gets €12k pa forever, even if they live to be 130 (future Government pension policy allowing, obviously). Why doesn't anybody use the same logic as for the fat cat public servants and consolidate this into a pot of €240k (multiply it by 20) and say that we all have the guts of a quarter of a million in our pension pots before we even start looking at funding a pension?

It is that reality - that successive Governments have effectively made unsustainable promises to give €240k to each and every qualifying worker when they retire - that underpin John Bruton's recent "controversial" remarks that this is unsustainable and will have to be defaulted upon (whether explicitly or implicitly, through a penal tax on the recipient at the time of payment).

The bottom line, I guess, is that the gap between "gold-plated" public pensions and their private equivalents is not as wide as is sometimes suggested. Better, yes, in most cases, but not unfairly so given the contribution history required to qualify for the full amounts (especially for those who may be paying the pension levy for more than 30 years) and who, when the time comes, really will have funded their pension (and will not be the recipient of unearned largesse, as some commentators like to pretend)

Gumbo

antoobrien wrote: »

I know that, the question is are they (post 95 PS employees) also entitled to full contributory pension?

The relevant DSP page seems to indicate that, subject to having enough service, they would be.

No, it's incorporated into our PS pension. We cannot claim our PS pension and the state COAP on top of that.

sugar_lover

ardmacha wrote: »

But they should get bigger pay decreases than everyone else, of course.

Of course they are entitled to the full OAP, isn't everyone else with 40 years contributions?
The question is surely what pension they receive as employees and the deliberate misrepresentation of same.

currently , you only need have made around ten years of PRSI contributions in order to qualify for the full 230 per week contributory old age pension

thats likely to change i imagine

Sheldons Brain

sugar_lover wrote: »

currently , you only need have made around ten years of PRSI contributions in order to qualify for the full 230 per week contributory old age pension

thats likely to change i imagine

if a teacher, say, paid 10 years PRSI and 10 years pension contributions they would get €11K/year from the PRSI and less than half that from their pension contributions. But then everything is stacked in favour of the pubic service, isn't it?

Paulzx

sugar_lover wrote: »

currently , you only need have made around ten years of PRSI contributions in order to qualify for the full 230 per week contributory old age pension

thats likely to change i imagine

That's not entirely accurate. If you have 10 years of contributions over a 40 year working life an average calculation is carried out and you might only qualify for a portion of the pension.

creedp

creedp wrote: »

In summary, public servant should never again receive, nor deserve, pay increases!

Having listened to that tool Marc Coleman, whose is now calling himself an independent consultant, on TV3 last night (bad idea at 11pm!) I'm even more convinced of the validity of the above summary. In between an emotional story about how he was going to plead for a banking writedown for Ireland in Berlin and Frankfurt - presumably he will don the tricolour t-shirt over the IBEC one on that day! - he delivered an even more emotional plea that prior to awarding pay increases to the PS (maybe OK for the low paid PS - didn't define) the Govt should consider the fact that the private sector (didn't define) hasn't had a pay increase since 2006!! Companies must be using their money to but nice new shiny commercial vehicles if the latest new vehicles registration figures are anyting to go by.

I always find it amusing when these guys go to critisize PS pay they start comparing the likes of the semi-states and the private sector. Last night it was the turn of using IW's bonus culture as an example of out of control pay in the PS. One of these days these experts may get a handle of the fact that the likes of Bord Gais and IW are not paid in the same manner as PS but of course convenienty their higher pay is incorporated into the PS average figure to be compared to the palty private sector equivalent.

Bizaarre stuff for a supposedly independent and objective consultant economist.

fliball123

barneystinson wrote: »

Doesn't change the fact the fact that the so called pension levy is a pay reduction. It was confirmed as such by the minister who introduced it. It isn't a pension contribution.

This crap about the DB pension being "worth more than 10%" - SO WHAT! Most large employers who operate occupational pension schemes have employers' contributions which often match the employees' contributions...

Sorry all it does it gets you lot to pay a bit more for you pension instead of asking the other 1.3million private sector workers who a large % cant afford their own..So suck it up, you get the benefit..You should all be turfed off your pensions and told where to go

fliball123

creedp wrote: »

In summary, public servant should never again receive, nor deserve, pay increases!

They have received pay rises all the way through the crash..Increments have never stopped

Brussels Sprout

creedp wrote: »

Having listened to that tool Marc Coleman, whose is now calling himself an independent consultant, on TV3 last night (bad idea at 11pm!) I'm even more convinced of the validity of the above summary. In between an emotional story about how he was going to plead for a banking writedown for Ireland in Berlin and Frankfurt - presumably he will don the tricolour t-shirt over the IBEC one on that day! - he delivered an even more emotional plea that prior to awarding pay increases to the PS (maybe OK for the low paid PS - didn't define) the Govt should consider the fact that the private sector (didn't define) hasn't had a pay increase since 2006!! Companies must be using their money to but nice new shiny commercial vehicles if the latest new vehicles registration figures are anyting to go by.

I always find it amusing when these guys go to critisize PS pay they start comparing the likes of the semi-states and the private sector. Last night it was the turn of using IW's bonus culture as an example of out of control pay in the PS. One of these days these experts may get a handle of the fact that the likes of Bord Gais and IW are not paid in the same manner as PS but of course convenienty their higher pay is incorporated into the PS average figure to be compared to the palty private sector equivalent.

Bizaarre stuff for a supposedly independent and objective consultant economist.

Marc Coleman is a joke. Nobody takes him seriously. His Sunday night radio show on Newstalk is basically a vehicle for him bang the drum for his pro-life agenda in between coughing and spluttering into the microphone. He tries to mimic the likes of Sean Hannity on Fox News by aggressively questioning and shouting over his guests and using the terms "group think" and "main stream media" repeatedly.

I think in Ireland. like Ivan Bacik, he does his causes more harm than good which is unfortunate in the case of PS pay.

barneystinson

fliball123 wrote: »

Sorry all it does it gets you lot to pay a bit more for you pension instead of asking the other 1.3million private sector workers who a large % cant afford their own..So suck it up, you get the benefit..You should all be turfed off your pensions and told where to go

But it's not a pension contribution, what part of that do you not get?

And here's proof: There are people, who pay the PRD, who do not accrue any pension entitlement. They don't pay pension contributions, because they aren't in pensionable employment, but they do pay PRD.

So once and for all Fliball, take it on the chin and accept its not a pension contribution.

barneystinson

fliball123 wrote: »

They have received pay rises all the way through the crash..Increments have never stopped

Increments are not pay rises. They are progression towards being paid the full rate for a job.

And it's incorrect that they never stopped. I didn't get one this year despite being at the bottom point on a pay scale and satisfactory performance, and under Haddington road my pay will remain the same until 2017...

Is that not stopped?!

AdrianII

increments are still happening. last one would have been received in jan 2014, next one will be 15 months after that (April 2015) then the next one another 15 months (july 2016) then back to every year after that.

_Kaiser_

barneystinson wrote: »

Increments are not pay rises. They are progression towards being paid the full rate for a job.

And it's incorrect that they never stopped. I didn't get one this year despite being at the bottom point on a pay scale and satisfactory performance, and under Haddington road my pay will remain the same until 2017...

Is that not stopped?!

Wut?

I worked in the public sector for almost 5 years and every year got an increment regardless. Not one performance review in that time either, but I came from the private sector so just got on with what needed to be done and as I was managing my own department it was in my own interests to improve and make things more efficient. Plus I'm not the type to sit back anyway.. which is probably why I've continued to progress in my career, despite being laid off from that job and out of work for a year afterwards.

I've no issues with people getting pay raises but they should be based on proven performance against agreed targets (y'know like is the norm anywhere else) - not "just coz", or because they're sitting there long enough.
Equally there should be an effective disciplinary process where people who don't perform may face sanctions up to and including dismissal.. again like anywhere else!

fliball123

barneystinson wrote: »

But it's not a pension contribution, what part of that do you not get?

And here's proof: There are people, who pay the PRD, who do not accrue any pension entitlement. They don't pay pension contributions, because they aren't in pensionable employment, but they do pay PRD.

So once and for all Fliball, take it on the chin and accept its not a pension contribution.

that is not proof the money from taxes, levies, etc all go into the same pot of money and the gov use it to pay for things such as ps pensions , welfare, etc are paid out.. All this does is gets the p.s to pay more (and not even close to the amount paid by the private sector to cover the rest for public sector pension) and you get a premium gold plated pension..therefore you should pay that bit more..If a PS worker does not get any benefit (tough crap) .. the private sector get no benefit yet we are asked to cover the shortfall...Trust me I would rather you didn't get your pension and then the tax payer could get a tax cut for the amount that they are forced to pay to subsidise the hole that is the public sector pensions scheme.... So you suck it up there pal no reversals in fact the pension levy should be increased until the public sector cover the cost of their own pension. it is morally wrong to ask the other 1.3 million other people to pay for the 300k in the ps and the retired ps at a time when the government have taken money out of private pensions and a lot of people cannot afford their own.

fliball123

barneystinson wrote: »

Increments are not pay rises. They are progression towards being paid the full rate for a job.

And it's incorrect that they never stopped. I didn't get one this year despite being at the bottom point on a pay scale and satisfactory performance, and under Haddington road my pay will remain the same until 2017...

Is that not stopped?!

Sorry does the person who gets the increment does their pay go up.?? Yes
Does the amount that the tax payer have to cover go up ?? Yes

its a pay rise..only in the blinkered world of the public sector is a pay rise not a pay rise and a contribution to a defined benefit (the pension levy) is a pay cut??

PeteFalk78

fliball123 wrote: »

Sorry does the person who gets the increment does their pay go up.?? Yes
Does the amount that the tax payer have to cover go up ?? Yes

its a pay rise..only in the blinkered world of the public sector is a pay rise not a pay rise and a contribution to a defined benefit (the pension levy) is a pay cut??

Fliball your hatred for the public sector is almost pathological.

IF you think that all jobs in the PS are so cushy and the perks are so good then why didn't you get one in there yourself?

fliball123

PeteFalk78 wrote: »

Fliball your hatred for the public sector is almost pathological.

IF you think that all jobs in the PS are so cushy and the perks are so good then why didn't you get one in there yourself?

I dont hate the public sector..I hate the collective bargaining, strong handing , unsionised strangle that they have over the country. I hate thier entitlement culture and can be shown here when increments are not considered payrises..

There has been an embargo on it for the last 6/7 years so how could I get in there. ??

All the whinging and moaning about cuts to their wage...yet they forget that in the same period since 2008 there has been 7 increment increases and now they think because the economy is on the up that they should first in the queue for a pay rise.

They need to be told that we are still borrowing billions. The deficit is over 200billion and that other people who contributed more like the tax payer and people who have had disabilities cut are first in the queue when there is some room to maneuver with finances. Then and only then pay rises within the ps and only to those in there that deserve it.

The last 7/8 years the way the gov has dealt with ps pay and pensions has been like trying to empty a swimming pool and taking water out of the deep end and throwing it back in at the shallow end.

Riskymove

well with both Fliball and now myself here ...... I think we are all present and correct and can now rehash the last 5 years or so of Irish Economy pointless arguments!!

increments...check
levy a tax or contribution...check
PS incompetence....check
the bail out, borrowing etc.....check
gold-plated pensions...check

and so on and so forth

BaronVon

Mongfinder General wrote: »

I won't get anything with the way demographics are shaping up. I am paying into 2 compulsory pension schemes as well as a pension levy. I would prefer to be taxed like a regular "PAYE worker" and allowed to make my own investment decisions. I do not want to pay into a PS pension scheme because there will be nothing left in them when I retire!

Same as. I would much rather use my compulsory pension money, and pay off my mortgage quicker, then I could invest the money as I see fit once that's paid off.

fliball123

Riskymove wrote: »

well with both Fliball and now myself here ...... I think we are all present and correct and can now rehash the last 5 years or so of Irish Economy pointless arguments!!

increments...check
levy a tax or contribution...check
PS incompetence....check
the bail out, borrowing etc.....check
gold-plated pensions...check

and so on and so forth

Only difference is now the ps want a pay rise and think that we are no longer borrowing or in debt??

PeteFalk78

fliball123 wrote: »

Only difference is now the ps want a pay rise and think that we are no longer borrowing or in debt??

Everybody in the whole world wants a payrise. :rolleyes: