What if public sector pension is less than OAP?

Firefly

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Hi,

Deiseblue said in another thread

Public Sector pensioners do not receive the Old Age contributory pension in ADDITION to their occupational pensions rather the OAP is integrated into their pension.

I would like to know, what if the public sector pension is less than the OAP?

Consider someone who joined the PS a few years before retiring and their public sector pension was, say, 5k per year. Would they get this on top of the OAP or just the OAP?

Thanks,
Firefly
 
This relates to PS who pay a Class A PRSI - all PSs after 1995 and some prior to this.

It might be easier to explain by example.

Joe retires at normal retirement age for his pension scheme. His pensionable salary is €40,000 and he has 10 years service.

If Joe had been in the older (Class D) scheme his pension would have been €40,000 * 10/80 = €5000.

As a Class A it is assumed he will get at 10 years worth of State Pension, calculated as €13,000 * 10/40 = €3,250. His PS occupational pension will be €5000 - €3,250 = €1,750.

If for some reason Joe's State Pension is less that this (€3,250) he can apply to his former employer for a Supplementary Pension to cover the difference. This also applies if their is a gap between his normal retirement age and his state pension age (provided he is not in insurable employment).

Of course, Joe may get more than €3,250 in State Pension, eg, he may have been paying PRSI in the private sector before his PS job. That is fine and does not affect his occupational pension.
 
This relates to PS who pay a Class A PRSI - all PSs after 1995 and some prior to this.

It might be easier to explain by example.

Joe retires at normal retirement age for his pension scheme. His pensionable salary is €40,000 and he has 10 years service.

If Joe had been in the older (Class D) scheme his pension would have been €40,000 * 10/80 = €5000.

As a Class A it is assumed he will get at 10 years worth of State Pension, calculated as €13,000 * 10/40 = €3,250. His PS occupational pension will be €5000 - €3,250 = €1,750.

If for some reason Joe's State Pension is less that this (€3,250) he can apply to his former employer for a Supplementary Pension to cover the difference. This also applies if their is a gap between his normal retirement age and his state pension age (provided he is not in insurable employment).

Of course, Joe may get more than €3,250 in State Pension, eg, he may have been paying PRSI in the private sector before his PS job. That is fine and does not affect his occupational pension.
Hi,

Thanks for that.

If we take the following example:

Joe has worked all his life and is entitled to the full State Pension, say €13,000.
Joe joined the public sector a few years before retirement and accrued retirement benefits (as per the calculator above) of €3,361 per annum. Would Joe get this €3,361 on top of the State Pension?

Firefly
 
Joe has worked all his life and is entitled to the full State Pension, say €13,000.
Joe joined the public sector a few years before retirement and accrued retirement benefits (as per the calculator above) of €3,361 per annum. Would Joe get this €3,361 on top of the State Pension?

I note that is the Single Scheme estimator, which applies to new entrants since 2013. I know very little about this scheme but I assume the same principle applies as to previous Class A schemes. If so, then Joe would get his occupational pension from the Single Scheme and, also, whatever he qualifies for by way of State Pension. This may be the the full State Pension. The public sector employer has nothing to do with calculating the State Pension - the DEASP do this based on Joe's total PRSI record, be it public sector, private sector, or a combination of both. In your example, the €3,361 would be in addition to this.

This also applies if their is a gap between his normal retirement age and his state pension age (provided he is not in insurable employment).

Just to qualify this slightly. If Joe retires at 65 he would have to apply to Social Welfare for whatever benefit he may be eligible, before applying for a Supplementary Pension. This includes Jobseeker's Benefit. In this example, Joe would also be better off on Jobseeker's than getting the Supplementary. As far as I know, there is no Supplementary Pension eligibility attached to the Single Scheme.
 
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Any entrant to the Public Service after April 1995 should be a Class A PRSI contributor. Therefore subject to their PRSI record, they will qualify for some State Pension, currently at age 66. This will be in addition to any PS Occupational Pension whether an “integrated” DB or the new Single Scheme pension. If they retire at age 65, then as an A contributor, they can currently claim Jobseekers Benefit between 65 and 66.
If they are entitled to a Supplementary Pension (under the DB Scheme) , they must use up any Social Welfare entitlements first before being entitled to any Supplementary Pension.
 
This relates to PS who pay a Class A PRSI - all PSs after 1995 and some prior to this.

It might be easier to explain by example.

Joe retires at normal retirement age for his pension scheme. His pensionable salary is €40,000 and he has 10 years service.

If Joe had been in the older (Class D) scheme his pension would have been €40,000 * 10/80 = €5000.

As a Class A it is assumed he will get at 10 years worth of State Pension, calculated as €13,000 * 10/40 = €3,250. His PS occupational pension will be €5000 - €3,250 = €1,750.

If for some reason Joe's State Pension is less that this (€3,250) he can apply to his former employer for a Supplementary Pension to cover the difference. This also applies if their is a gap between his normal retirement age and his state pension age (provided he is not in insurable employment).

Of course, Joe may get more than €3,250 in State Pension, eg, he may have been paying PRSI in the private sector before his PS job. That is fine and does not affect his occupational pension.
 
I posted this on a different thread, but should be here.

@Early Riser

What about the following scenario for someone who joined post-2004, and pre-single scheme.

They work 8 years in the PS, and pay Class A PRSI. They then leave Ireland (for good) when on a salary of €50k. They can't make voluntary PRSI contributions or subsequently draw a state contributory pension as they have not paid 10x52=520 PRSI contributions.

Will they get a supplementary pension?

The answer would seem to be "yes" on the basis of this:

1. What happens if I do not qualify for Old Age Pension or any other Social Welfare benefit?
If, through no fault of your own, you do not qualify for Old Age Pension or any other Social Welfare benefit or qualify for only a partial entitlement then you may be entitled to receive a supplementary pension.

12. What is a supplementary pension?
A supplementary pension is an additional amount of pension that may be paid to a person whose occupational pension is co-ordinated with the Old Age Pension. It is paid in circumstances where the combined pensions (i.e. occupational and Social Welfare benefit) are less than the pension they person would receive if the occupational pension was calculated on a non-co-ordinated basis. It comes in for consideration when a person who is umemployed and who through no fault of their own fails to qualify for any Social Welfare entitlement; it represents the difference between the total of the pensions actually received by the person and the pension that would be payable if the occupational pension was not co-ordinated with the Old Age Pension.

On a coordinated basis annual pension would be ((3.33*SPC)*(8/200))+((€50k-(3.33*SPC))*(8/80))=€2,400. There would be no SPC at all.

But on a "non-co-ordinated basis" it would be 8/80*€50k= €5000k

So would a supplementary pension of €2,600 be paid on top of the €2,400?
 
On a coordinated basis annual pension would be ((3.33*SPC)*(8/200))+((€50k-(3.33*SPC))*(8/80))=€2,400. There would be no SPC at all.

But on a "non-co-ordinated basis" it would be 8/80*€50k= €5000k

So would a supplementary pension of €2,600 be paid on top of the €2,400?

Yes, they be would be eligible for a Supplementary of €2,600 from 65 (post-2004). They would have to show they are not receiving, or eligible to receive, a Social Welfare payment greater than or equal to this amount. So they would have to go through procedures with DEASP to confirm this (at 65 and again at State Pension age).

Also, they are not supposed to be in any insurable employment but I doubt if this would apply to employment in a foreign jurisdiction (I am only speculating about this).

PS. I don't know what the situation might be if this person were to use their Irish PRSI record towards claiming the State Pension in another jurisdiction, under the reciprocal arrangements.
 
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PS. I don't know what the situation might be if this person were to use their Irish PRSI record towards claiming the State Pension in another jurisdiction, under the reciprocal arrangements.

Thanks @Early Riser - I think this point is important.

I looked through some circulars and could find nothing concrete. I would tend to think it would not be within the spirit of the rules.
 
Hello
Can anyone please help with my enquiry
If someone was pre 95 DB class D, now class B
will have 28 yrs approx total years public/civil service years
41.000 salary so not entitled to state pension.
Have 5.5 yrs approx class A contributions prior to civil service.
Am 5 yrs to retirement date
Does the 5 yrs stamp A count toward a contributory pension or does it have to be 10 yrs before a partial pension could possibly be paid.
Is there any way of enhancing the 5 yrs Stamp A which is allowable.
 
Hello
Can anyone please help with my enquiry
If someone was pre 95 DB class D, now class B
will have 28 yrs approx total years public/civil service years
41.000 salary so not entitled to state pension.
Have 5.5 yrs approx class A contributions prior to civil service.
Am 5 yrs to retirement date
Does the 5 yrs stamp A count toward a contributory pension or does it have to be 10 yrs before a partial pension could possibly be paid.
Is there any way of enhancing the 5 yrs Stamp A which is allowable.
If you have at least 5 years A Class contributions, then you should be entitled to a Pro Rata Pension. So if your total history in the PRSI system will be 28+5+5= 38, then the Pro Rata Pension would be c5.5/38 x State Pension, so 14.5% of State Pension.
You could add to your previous 5.5 years of A by getting a Class A job for the next 5 years. That would increase your Pro Rata entitlement.
 
If you have at least 5 years A Class contributions, then you should be entitled to a Pro Rata Pension. So if your total history in the PRSI system will be 28+5+5= 38, then the Pro Rata Pension would be c5.5/38 x State Pension, so 14.5% of State Pension.
You could add to your previous 5.5 years of A by getting a Class A job for the next 5 years. That would increase your Pro Rata entitlement.
 
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