Michael McGrath (Cork South Central, Fianna Fail)
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1218. To ask the Taoiseach and Minister for Defence to address a matter raised in correspondence from a person (details supplied). [10414/16]

Enda Kenny (Mayo, Fine Gael)
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The matter referred to concerns a request for an increase in the pensions paid to retired members of the Defence Forces.

I am advised that up until September 2008, public service pensions, including military pensions, were generally increased in line with relevant pay increases applied to serving personnel and staff. This was commonly known as ‘pay parity’. Such pension increases normally required the prior approval of the Minister for Finance / Public Expenditure and Reform.

Since then, there have been effectively no public service pay increases and, as a consequence, no pension increases either. Rather, due to the fiscal crisis faced by the country, significant cuts to both public service pay and pensions were applied by way of the Financial Emergency Measures in the Public Interest Acts 2009-2013 (the FEMPI Acts).

In respect of pensioners, including Defence Forces pensioners, the key FEMPI retrenchment measure has been the Public Service Pension Reduction (PSPR). Introduced in January 2011, with deeper cuts to higher pensions applied from July 2013, the PSPR’s progressive design provides that it has never applied to annual pensions below €12,000, and at present no pension below €18,700 is affected by PSPR. By contrast, those employed as public servants all experienced pay cuts in 2010 regardless of salary level, together with a Pension Related Deduction (PRD – ‘pension levy’) applied since 2009 to earnings above €15,000.

In tandem with gradual pay restoration under the ‘Lansdowne Road Agreement’, and as legislated in the Financial Emergency Measures in the Public Interest Act 2015, a multi-stage part-restoration of the PSPR cuts to pensions is now in progress. The initial focus is on the people in receipt of relatively low pensions who are impacted by PSPR. This provides for a restoration of pension income affected by the PSPR on a phased basis over three years to most PSPR-impacted pensioners as follows:

- From 1st January 2016 – return of €400 per year

- From 1st January 2017 – return of €500 per year

- From 1st January 2018 – return of €780 per year.

It remains the position of Government that, in still-constrained fiscal conditions, pay and pension assistance measures for public servants and retired public servants should focus on the roll-back (part-reversal) of earlier FEMPI-delivered reductions (pay cuts, PRD, PSPR).

In the 2015 White Paper on Defence (Section 7.7) particular emphasis is given to a Veterans Policy. This gives special acknowledgement to the service and contribution of our veterans and their continued active support of the Defence Forces. It references the supports in place, and being developed, for former servicemen and servicewomen of the Defence Forces.