Something 'going to give' over pensions

The Pensions Ombudsman has suggested that the traditional public sector pension arrangements may have to be changed in the future.

At the Industrial Relations News conference on social partnership at UCD yesterday, Paul Kenny said that although the public finances were currently strong, the actuarial commitments involved in the provision of public sector pensions were very large. "Something is going to have to give," he said.

Mr Kenny said that public sector workers enjoyed a wonderful guarantee under which their pensions after retirement kept pace with the current pay for the job.

He said that a secretary general of a government department could retire on half the pay of his successor. He said that if the serving secretary general received a pay increase of €20,000 a year, the pension provided to the eight or nine of his predecessors increased by €10,000 a year.

He had read recently that a chunk of the National Pension Reserve Fund would be required to meet the pension liabilities of Dublin City Council alone.

Mr Kenny forecast that there would be a lot of resistance to reform of the public sector pension arrangements.

Fine Gael finance spokesman Richard Bruton told the conference that in future the Oireachtas needed to have an input into setting the pre-negotiation agenda for any future partnership agreement. He said the partnership process could play a role in areas such as reform of planning, healthcare and transport.

Senator Martin Mansergh (Fianna Fáil) said he did not believe the Oireachtas had been sidelined by the partnership process. He believed the process enhanced democracy.

Siptu regional secretary Patricia King said that while there were decent employers, "as a country we are building a set of people who believe that the route to high profits is low wages and that in the main the non-national society coming in is the avenue for it".

She said she believed that the social partnership process had the capacity to stop this trend.