Róisín Shortall (Dublin North West, Labour)
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Question 200: To ask the Minister for Finance his plans regarding the way in which retirement increases for existing public service pensioners are awarded. [20489/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Budget 2010 announced that the Government would be considering using the Consumer Price Index as the basis for post-retirement increases for both existing and future public service pensioners. The CPI linkage would displace the linking of public service pensions to earnings, also known as "pay parity". The Government is conscious of the substantial long-term saving for the Exchequer which would be expected to materialise were this change to proceed and that it demonstrates a significant level of administrative and fiscal reform.

The draft Public Service Agreement provides that there will be discussions on the method of pension increases for serving staff and current pensioners in the context of discussions on the review of pay in Spring 2011. The clarification of the Draft Public Service Agreement issued recently by the facilitators separately indicated that, while I announced in Budget 2010 that I am reviewing the arrangements around indexation of Public Service pensions and considering linking Public Service pensions increases to the cost of living, no change in the indexation arrangements for the indexation of Public Service pensions for serving public servants and current public service pensioners will be implemented during the period of the agreement.