The call by employers' group Ibec for changes to public sector pensions as part of any Government cost-saving measures has drawn criticism today.
Ibec has proposed new entrants into the public service would not be entitled to a defined benefit provision. Instead, it suggests new employees should be offered a defined contribution pension with a State guarantee of minimum investment returns.
David Begg, Ictu general secretary, said he did not think the proposals had been through through and pension issues being discussed by Ibec are “way into the long distance”.
The Impact trade union has accused Ibec of exploiting the recession to drive down the value of public and private pensions.
It said Ibec’s proposals to devalue public service pensions “would do little to help the present crisis in public finances, but would effectively signal the end of employers' responsibility for pension provision”.
Impact deputy general secretary Shay Cody said: "Throughout the boom years, Ibec sat idly by while many of its members dismantled occupational pensions in the private sector”.
“Now it's exploiting the present crisis as a tool for employers to escape what responsibilities remain and place the entire pensions' burden on employees and the taxpayer.”
Labour leader Eamon Gilmore accused the employers’ organisation of pursuing an “old and bitter agenda”.
“Within the past few weeks we have calls from Ibec for cuts in public service pay and massive cuts in the numbers employed in the public service. Now Ibec has decided to target public service pensioners,” he said.
“It seems to me that Ibec have made a conscious decision to take advantage of our very real economic difficulties to try to turn the clock back and to reverse the advances that have been made for workers in both the public and private sectors over recent decades.”
Mr Gilmore said although public sector pay must be "in the mix" in any remedial measures, “I will not allow public service workers or pensioners to become soft targets for the comfortable bosses in Ibec”.
He called some of the body’s suggestions “ludicrous”, adding: “If we are to overcome the current crisis it will need a co-operative effort from unions, employers and politicians.”
The Garda Representative Association (GRA) described Ibec’s proposal as an “opportunistic attack on pension entitlements to divide public opinion over public servants’ pension entitlements”.
The association said the proposal was a divisive measure which would not “significantly” improve the exchequer’s current finances but would create “confusion that public servants are better off than their private sector counterparts.”
GRA general secretary PJ Stone said: “It is extremely disappointing that a body like Ibec should be taken at face value on this issue. Their reason to exist is to ensure that workers do not detract from the riches of the employers. They are proposing to reduce working and living standards and employee benefits so that the fat cats can get fatter.”
Sinn Féin finance spokesman Arthur Morgan also criticised Ibec's proposals to scrap defined-benefit pension schemes for those working in the public service.
"Pension schemes are an integral part of pay and benefits package and the elimination of defined benefit schemes of gardaí, nurses and other public sector workers would be a retrograde measure.
"It was the Government and the fat cats in the financial and property sector that have created the economic crisis - not public sector workers," he said. "It is simply wrong to put to force low and middle earning workers in the public sector pay for the failure of successive Fianna Fáil led governments."
Paula Clancy, director of the independent think tank Tasc, said an extension of “yellow pack pension provision” to people in the public services was no substitute for fundamental pension reform.
“Unfortunately, growing numbers of people are being forced to rely on defined contribution schemes as employers shy away from defined benefit schemes. Today’s call by Ibec for defined benefit schemes to be scrapped for new public servants has less to do with the current financial crisis than with Ibec’s long held policy of promoting defined contribution pension provision,” Ms Clancy said.
“Now Ibec wants to extend this yellow pack pension model to those - like nurses, teachers and Gardai - who keep our public services going."
