Public sector pay report to back keeping pension levy
A new pay commission is set to advise the Government to keep in place a pension levy that was imposed on public servants during the financial crisis.
In its first report, the Public Service Pay Commission is expected to support the Government position that most of its 300,000 employees make a bigger contribution towards their retirement benefits.
It will suggest the levy, worth roughly €2,500 for the average worker, is converted into a pension contribution to take account of a dramatic fall in the value of private sector workers' pensions in recent years.
The Government is keen to hold on to the levy, which brings in €720m a year, although it may be prepared to negotiate modest pay rises with unions at talks on a new pay deal due to start next month. It is also understood the commission's initial report will point to a need to continue the process of unwinding the emergency legislation that cut state workers' wages. But it is expected to suggest this should not be done in just a few years in a single pay deal.
The report is due to be presented to Cabinet the week after next. The legislative basis for implementing the higher pension contributions could be done through amendments to the statutory schemes that established the varied pension schemes that apply across the state sector.
The commission's report will find public servants' pensions are significantly more valuable than private sector workers' and will make a detailed comparison between public servants' pay and their private sector and international equivalents.
Sources said the Government thinks public servants' pensions are vastly out of line with the private sector and if they want to hold onto them, they will have to pay more. The commission's report will trigger talks on a new deal to replace the existing Lansdowne Road Agreement (LRA) and any pay rises agreed will be included in next year's budget.
An invitation from the Government is likely to be sent to the public sector union leadership - the Public Services Committee of the Irish Congress of Trade Unions - shortly after the report goes to Cabinet.