Thoughts on the Single Public Service Pension Scheme (SPSPS)

I think it would be wrong to state that "there's no other benefit". As I said, you're fixating on the notional rate. It's notional. It could be more (if there has been higher wage increases) it could be less (interest rates have gone up).
 
Question...if someone joins and does eg 20 years service, assuming same salary for entire 20 years, pension is 20/80 ie 25% of average salary.

But the contributory pension is included in this. So eg 100k average salary, 25k pension of which 12.5k is contributory? Or does the pension included in this get prorated as well?

Or is this the disadvantage of joining the public service for <40 years, ie ratio of contributory to occupational pension is higher with less service?
 
misemoi said:
Question...if someone joins and does eg 20 years service, assuming same salary for entire 20 years, pension is 20/80 ie 25% of average salary.

But the contributory pension is included in this. So eg 100k average salary, 25k pension of which 12.5k is contributory? Or does the pension included in this get prorated as well?

Or is this the disadvantage of joining the public service for <40 years, ie ratio of contributory to occupational pension is higher with less service?
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If someone worked for twenty years with the same salary under the Single Scheme their pension would be 20/80 less the value of the contributory state pension * 0.5 + lump sum.

Assume salary of €100,000 for twenty years and the State Pension remained at €15,000 for the period for simplicity sake.

That's person's pension benefits after twenty years would be (€50,000 - €15,000) * 0.5 = €17,500 (+€75,000 Lump sum)

If they worked the forty years at same rates it would be €50,000 * - €15,000 = €35,000 (+€150,000 Lump sum).
 
Any thoughts on how the SPSPS compares to a pension in the private sector?

For example, private sector employee earning €70k making 5% pension contribution in addition to 10% employer contribution.

Would moving to the public sector and the SPSPS be a major step backwards from a pension point of view if the basic salary remains the same at €70k?
 
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The Single Pension Reform is one of the biggest reasons for lack of recruitment and retention right across the public sector , Cornmarket are doing a very good job at highlighting the difference between Post 2012 and those on Pre95 and Post95 Pensions .
 
Plenty of media coverage today of Heather Humphreys and the upcoming auto enrolment scheme. This is ground we've discussed here before, but given that scheme =€3 employee contribution = €3 employer +€1 state contributions, would members end up better off than under the SPSPS? Are there worked examples out there comparing different scenarios for this?
 
This new Auto Enrollment is aimed at those not already members of an Occupational Pension Scheme. These are predominantly workers in Retail, Hospitality and those in SME's.
 
Conan said:
This new Auto Enrollment is aimed at those not already members of an Occupational Pension Scheme. These are predominantly workers in Retail, Hospitality and those in SME's.
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Yes. Has anyone seen any computations for what these contributions would entitle people too, eg. For a 30k salary or 50k salary. I've seen no mention anywhere of what people can expect to get out of this.

For context, I'm private sector and wife if public service
 
If you pay tax at 40% and your employer will match your pension contributions, you're better off in a traditional pension scheme. If you pay tax at the lower rate of tax, the auto-enrolment scheme is better. The auto-enrolment scheme doesn't seem to have any facility to vary your contributions. There's a lot of discussion of the auto-enrolment scheme on Askaboutmoney here.
 
LDFerguson said:
If you pay tax at 40% and your employer will match your pension contributions, you're better off in a traditional pension scheme. If you pay tax at the lower rate of tax, the auto-enrolment scheme is better. The auto-enrolment scheme doesn't seem to have any facility to vary your contributions. There's a lot of discussion of the auto-enrolment scheme on Askaboutmoney here.
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Thank you.

Unless I'm mistaken, there are no computations in those threads of expected pension entitlements for someone say on an average salary of say
50k or whatnot? I can't find such data anywhere!
 
Considering @Ent319 's idea to (maybe) re-do this thread
Ent319 said:
I was thinking about re-doing this thread when I have time to simplify the first post and capture some of the main points of discussion that have arisen in the interim.
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I am uploading a 2024 updated and more refined version of the pay calculator I uploaded last year. It calculates correctly for me and a few of my colleagues (within a few cent for some, and within a euro or two for others). Just to note this is only for Post 2013 recruits to the public service.

Considering this is a pension related thread, I have also included a quick calculation in it that will show the maximum amount you could contribute via AVC to attract tax relief for your age range accounting for your standard contributions already made through payroll to the Single Public Service Pension Scheme (SPSPS).

I believe some of the formula in this spreadsheet will only work in Excel 2019 and later versions.
 

Attachments

  • Post 2013 (SPSPS) Pay Calculator - 2024.xlsx
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That's great gort thanks. It's going to be a few weeks before I will have the time to sit down and write a new thread but if anyone has any questions about what they'd like covered let me know.
 
gort_gráinneog said:
Considering @Ent319 's idea to (maybe) re-do this thread

I am uploading a 2024 updated and more refined version of the pay calculator I uploaded last year. It calculates correctly for me and a few of my colleagues (within a few cent for some, and within a euro or two for others). Just to note this is only for Post 2013 recruits to the public service.

Considering this is a pension related thread, I have also included a quick calculation in it that will show the maximum amount you could contribute via AVC to attract tax relief for your age range accounting for your standard contributions already made through payroll to the Single Public Service Pension Scheme (SPSPS).

I believe some of the formula in this spreadsheet will only work in Excel 2019 and later versions.
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Sorry for bumping an old thread, but I just wanted to say thanks for making this.

I had a question regarding your fortnightly number of 26.09. What is the extra 0.09 here?

I changed that and it calculates for me within 7 or 8 cents (would still love to figure that bit out, it's bugging me).

I'll need to spend a good while in the under the hood section to get a real understanding of this. It always annoyed me trying to understand my payslips!
 
Hey beautfan thanks for getting back to me. I was wondering if it was to do with that. I think it has the unfortunate side effect of breaking a typical fortnightly pay for the sake for being correct over a 4 year period but I'm thankful for the calculator regardless.
 
Ent319 said:
I don't think so. Uprating for people under the old scheme is determined by the wages paid to people in equivalent grades who are currently working.


This was true in the past but may not always be the case. The war in the Ukraine's showed how fragile global supply chains are and the impact this can have on inflation. Also, maybe as single scheme members become the majority in unions they'll negotiate better deals for single scheme members (e.g. via bonuses, which may not count as salary and may not lead to uprating for old scheme members!)


This is my take, yes. That pension will grow tax free for decades. If it's in a good fund it could grow at 8%.

Compare that to spending the money now to buy an annuity. The annuity will only ever grow at the rate of inflation. So if you think the stock market can beat inflation it makes sense to keep the pension / invest in AVCs and decide whether to transfer over later.

There aren't any particular requirements if one wants to make AVCs as part of the single scheme. Most orgs will be signed up to an AVC scheme. Many are on the Forsa Scheme sold by Cornmarket. It's got decent rates. 0% contributes fees and an AMC of 1% on 0-40,000, 0.75% on 40,000 to 140,000, and 0.5% thereafter. Cornmarket's default funds are crap - you can select the other Irish life funds.
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daenaethra said:
I think it has the unfortunate side effect of breaking a typical fortnightly pay for the sake for being correct over a 4 year period but I'm thankful for the calculator regardless.
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beautfan is correct as to why it's set that way. The reason I have used 26.09 is because that's what my particular payroll department uses for calculating fortnightly pay. So it's the most accurate representation of a payroll calculator for me. I believe that most centralised payrolls within the public service also use a similar figure rather than a flat 26. This accounts for the leap year and week 53 (or fortnight 27) scenarios that occur every 13/14 years for fortnightly paid staff.
 
Really interesting. I'm in a local authority and the flat 26 is almost exactly mine but I still have to tinker with it. For some reason the taxes are off but the total matches the expected within a few cents (as 26.00). At 26.09 it's off buy a few euro and the taxes are still off. I'll keep messing with it, thanks again gort.
 
That spreadsheet seems great, if I'm using it right. After years of stress and a pandemic reassessment of priorities, my other half has joined the public service as a Clerical Officer at age 56 and while the pay is very modest, he would still like to contribute the maximum permitted, 35%, to his pension. He does have a PRSA policy for AVCs, though he hasn't contributed to it in some years (it's a low cost one through a broker recommended on AAM), but trying to find out how much his Single Scheme participation might require him to knock off that 35% has been like pulling teeth.

Am I reading this right that the Single Scheme participation makes only a few per cent of a difference? On an annual salary of about EUR29,195 (not 100% sure as it's phrased as a weekly payment), 35% of his pay equates to EUR10,218 and the spreadsheet says his maximum additional AVC for the year is EUR9,330, which is 32% (all rounded slightly). Does that seem right?
 
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