James Browne (Wexford, Fianna Fail) | Oireachtas source

The Minister for Public Expenditure, National Development Plan Delivery and Reform, Deputy Donohoe, has overall policy responsibility for public service occupational pension schemes payable to retired public servants.

For all new entrants to the public service on or after 6 April 1995, the date of introduction of full social insurance for public servants who now pay class A PRSI, and before 1 January 2013, the date of introduction of the single public service pensions scheme, their pension is integrated. An integrated pension scheme looks at the State pension as part of the total pension package promised to employees on retirement. One reason for this is that both employers and employees make PRSI contributions and these entitle scheme members to social insurance benefits, including the State pension contributory, SPC.

Integration is used as a means of taking into account the benefits payable under the social welfare system to calculate: the amount of pension payable from a pension scheme, so that the combined pension from both sources - State pension and occupational pension - is at the level aimed at in the scheme's design; and the level of contributions payable by the employee towards the cost of their occupational pension, so that the contributions payable to an occupational pension scheme reflect the offset from scheme benefits to allow for the State pension. Typically this is achieved by calculating pension benefits based on this lower pensionable salary at retirement and, therefore, the pension payment of a post-95 public servant comprises three components: a reduced public service occupational pension payable by the public service employer; social insurance benefits, payable, subject to eligibility, by the Department of Social Protection; and, where the full rate of SPC is not payable, a supplementary pension equivalent to a non-integrated pension, which is payable, subject to eligibility, by the public service employer.

Where a public servant does not qualify for the SPC or qualifies for a social insurance benefit at less than the value of the SPC, they may be entitled to an occupational supplementary pension, subject to eligibility criteria. In addition, the granting of an occupational supplementary pension depends upon a number conditions, as follows: one, the retired public servant is not in paid employment; two, the retired public servant, due to no fault of their own, fails to qualify for social insurance benefits or qualifies for a benefit at less that the value of the SPC; and, three, the retired public servant must have reached minimum pension age or retired on grounds of ill-health.

The second condition is important to ensure no duplication of payments from public funds. To verify this condition, prior to payment of the occupational supplementary pension, a retired public servant must engage with the Department of Social Protection and obtain proof that they have exhausted any relevant benefits for which they may be eligible under the social insurance system.

A significant number of occupational pension schemes, both private and public sector, make an allowance for the State pension when providing a pension from their pension scheme.

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