Saturday 25 November 2017

Calls for reform of system that puts 'financial pain' on non-civil servants

The State contributory pension is now only paid from the age of 66, meaning that thousands of people who are compelled to leave work at the age of 65 have to claim Jobseekers' Benefit. (Stock picture)
The State contributory pension is now only paid from the age of 66, meaning that thousands of people who are compelled to leave work at the age of 65 have to claim Jobseekers' Benefit. (Stock picture)
Charlie Weston

Charlie Weston

Calls have been made for reform of the pensions system after it emerged that State employees can escape from controversial rule changes.

It has emerged that public servants can escape pension rules that delay the payment of the State pension.

The State contributory pension is now only paid from the age of 66, meaning that thousands of people who are compelled to leave work at the age of 65 have to claim Jobseekers' Benefit - getting almost €50 a week less than they would from their pension.

However, the Irish Independent has revealed that public servants can get a "supplementary pension" before they reach the age of 66 to qualify for the State contributory pension.

A Department of Public Expenditure spokesman defended the supplementary pension, insisting that those who get it have to sign on to declare themselves as unemployed.

But head of advocacy and communications for Age Action Justin Moran said the revelations show again the urgent need for reform of the State pension system.

Justin Moran, Age Action. Photo: Robbie Reynolds
Justin Moran, Age Action. Photo: Robbie Reynolds

"It was madness to abolish the State transition pension without addressing the plight of the thousands of workers facing losing their job at 65 because of ageist mandatory retirement clauses.

"If public sector workers are entitled to a supplementary pension between retirement and the pension age there is no reason why private sector workers should not get the same," Mr Moran said.

And the head of business lobby group ISME, Neil McDonnell, said the fact that public servants were able to get a supplementary pension makes a mockery of the move to raise the State pension age.

"The terms and conditions that apply to the public service seem to be different to everyone else.

"The existence of these supplementary pensions makes a nonsense of the decision to raise the pensions age."

Mr McDonnell added that a different calculation was used to work out the value of the pensions of senior public servants and politicians than that used for the private sector. Penalty tax rates are imposed for exceeding these imputed values.

"There is a real question around equity here. Voters are expected to swallow financial pain, but that does not always apply to the public sector," the ISME chief said.

Public servants recruited since May 1995 are part of the PRSI system that funds the State contributory pension payments.

Irish Independent

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