Public service pensions will cost €2.4 billion this year, according to a new report from the Comptroller and Auditor General.
The report says that gross outflows between 2009 to 2058 will amount to €367 billion at 2008 prices. However, it adds that after taking account of inflows in the form of standard pension contributions and the recently introduced pensions related deduction. the net outflow is estimated at €157 billion over the same period.
Public service pension schemes cover over 300,000 staff and more than 100,000 existing pensioners, and their dependents.
The Comptroller and Auditor's report warns that the pension burden is set to rise significantly over the next 50 years, saying that while net public servie pension payments currently absorb 0.5 per cent of Gross National Product (GNP), as a result of demographic changes it will be necessary to devote 1.8 per cent of GNP to meet the net cost of pension payments by 2058.
According to the report, based on the cost of one year’s additional service, the pension provision for an average public servant will cost around 9 per cent of pay after account is taken of contributions made and the pension related deduction. The gross cost is on average 20 per cent of pay, the Comptroller said.
