Pension entitlements more valuable than salaries for Ministers of State
In the case of office holders who would not yet be entitled to a pension, you use a further calculation to work out the annuity cost.
You first work out how much the pension would cost in the private sector (as per steps 1, 2 and 3 above). The resulting figure is then divided by 1.02 (where 1.02 represents a 3 per cent inflation cap and a 5 per cent return on investment – a net 2 per cent).
This figure ( X) is put to the power of the number of years until the Minister reaches retirement age. (So if a Minister has seven years before he/she reaches retirement age, the calculation is X to the power of 7.)
The small print
All calculations are estimates based on Oireachtas/government guidelines and worked out on “new scheme” pension arrangements that have been in place since 1993.
Ages and lengths of service were taken from the Oireachtas website and calculated up to March 9th, 2016 – the end of the current Dáil term.
All TDs/Senators elected after April 1st, 2004, cannot receive a pension or pension lump sum until they reach 65 unless they previously served in a public service body. Those who served as a TD/Senator prior to this date are not entitled to a full pension until they reach 50 (although they may receive a reduced pension and pension lump sum between the ages of 45 and 49). TDs and Senators pay 6 per cent of their gross salaries towards their pension entitlements.
The ministerial pension scheme does not involve any deductions from salary.
Since May 1st, 2009, public servants’ remuneration is also subject to the following annual pension-related deductions: up to €15,000 – exempt; between €15,000 and €20,000 – 5 per cent; between €20,000 and €60,000 – 10 per cent; above €60,000 – 10.5 per cent.
In working out an office-holder’s long-term pension projection, spouses were included in the calculation where the office holder is married.
On the death of a former office holder, his/her spouse is eligible for half the pension. When calculating office holders’ long-term pension projections, where a TD/Senator was married, wives were assumed to be two years younger than their husbands, while husbands were assumed to be two years older than their wives.
The small print
All payments are estimations based on Oireachtas/Dept of Finance pension guidelines. Calculations have been made as per “new scheme” pension arrangements in place since 1993.
Dates of birth/lengths of service are as stated on the Oireachtas website.
* In cases where a serving TD also served in the Seanad their senators pension is not included. Similarly where a serving Senator also served in the Dáil their TDs pension is not included.
** Calculated on full years’ service as a sitting TD/senator. Maximum 20 years.
*** Not entitled to a pension payment (in 2016) as office holder is not the requisite age.