Public sector pensions add up to €129bn over 60 years
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.
This is a rise of €13bn, in what pensions experts said was a significant revision to the public sector pensions bill.
The original estimate was based on the cost of public sector pensions only and excluded the state contributory pension.
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.
Once the cost of integrating public sector and the state contributory pensions together was estimated, the C&AG said the overall pensions costs for public servants jumps to €129bn.
These costs will have to be met over the next 60 years, the C&AG said. Calculations by the top official show that the net cost of providing a pension for a public servant is 19.5pc of their annual salary.
The largest chunk of the cost of public sector pensions is expected to be spent on teachers at €31bn, followed by those in the health sector (€24.3bn).
For civil servants employed before 1995 who do not pay PRSI the pension costs amount to 15pc of annual salary.