McCreevy defends pension age rise to 65

Ireland must use the opportunity it has to prepare for future pension needs, said the Minister for Finance, who defended legislation to increase the public service pension age to 65.

As the opposition accused the Minister of being inflexible, ignoring teachers and breaking the spirit of social partnership in "imposing" the increased retirement age, Mr McCreevy said: "Either we take moderate, reasonable steps now to secure the future or, like our EU partners, we must face the need for more radical changes in the years to come."

The National Pensions Reserve Fund has now accrued almost €10 billion, but the Minister said the Government was not complacent about the issue.

He was winding up the initial Dáil debate on the Public Service Superannuation (Miscellaneous Provisions) Bill, which raises the standard minimum pension age for new entrants in the public service from 60 to 65 years and abolishes the link for new entrants between age and compulsory retirement in most areas of the public service.

The Minister insisted there were extensive discussions between Government and trade unions and public service staff representative organisations but "despite our best efforts, full agreement was not reached".

However, Labour's education spokeswoman, Ms Jan O'Sullivan, said the Bill was a betrayal of the spirit of partnership because the Minister was pushing through the legislation without the social partners' agreement.

The Bill will have an impact on future politicians' pensions, and Mr Barry Andrews (FF, Dún Laoghaire) said the legislation would affect new entrants, who perhaps faced a "short political career". It was not unreasonable for a TD to expect some kind of pension, given the increasingly precarious nature of the job but "we should not be entitled to the pension at young ages" when the rest of the population was not entitled.

Mr Conor Lenihan (FF, Dublin South West) welcomed the preferential treatment for the position of Taoiseach. "He or she will be fully entitled to his or her pension immediately on ceasing to be Taoiseach. This is proper and appropriate because we should treat the office in a special and particular way."

Fine Gael's education spokeswoman, Ms Olwyn Enright, said her greatest criticism of the Bill was its lack of flexibility. She said: "Teaching is a demanding and stressful job, and cases of teacher burn-out occur. We must consider what practical benefit will accrue to students if teachers who wish to leave the profession, or move to a less stressful or intensive role within it, are forced to teach for an additional 10-year period."

Mr Joe Higgins (Socialist Party, Dublin West) said: "The Minister for Finance is now seeking to chain public servants to their places of employment until they reach 65 years of age to provide for a saving of €300 million in 40 years.

That was incredible when Mr McCreevy in his budget speech in December 2001 had slashed corporation taxes to the effect of €329 million in a full year.