The majority of retired public sector workers are set to get pension hikes of 6.5 per cent to cope with the cost of living crisis.
Over 190,000 workers will benefit from the increase to match pay rises being given to existing public sector workers in the new €1.6 billion public sector pay deal.
The landmark decision is expected to benefit retired nurses, Gardaí, teachers, civil servants, council staff, and more - the Business Post reports.
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Ireland’s largest public service trade union, Forsa, has written to the Department of Public Expenditure to seek confirmation that the bridge between public sector pay increases and public sector pension increases will be maintained.
Forsa has told its members that rises in public service pay scales are generally reflected in public service pensions that are linked to pay scales, the Business Post reports.
A Forsa source told The Business Post, “that it would be a major break with existing practice if this did not happen.”
The majority of public sector pensioners are expected to qualify for the increase because they are on the older form of the public sector pension.
The older form of the public sector pension has been traditionally linked to public sector pay increases.
Under the revised estimates carried out by the State, the current public sector pension bill is €3.7 billion this year.
The public sector pension bill is for 57,000 retired HSE staff, 44,000 retired teachers, 31,000 former civil servants, 22,000 retired council staff, 13,000 former Defence Forces members, 11,000 retired gardaí and 11,000 retired third level staff.
An actuarial review revealed the total cost of funding all existing public sector pensions would drop from €150 billion to €127 billion – a difference of €23 billion.
This drop would occur if the policy of linking public sector pay increases to public sector pensions was abandoned.
Under legislation the government has the power to do this, but has chosen not to because of the backlash it would provoke from public sector pensioners.
However, any public servants who joined since 2013 are on a less valuable pension scheme.
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