This thread has become so complicated. It is a mix of public service pensions and private pensions advice.
Laramie, the thread is complicated because of conflicting advice, the issue is the "integrated" pension scheme. Across both the Private and Public Sector schemes this had the one aim, the principle underpinning both schemes, was that the combination of your occupational pension (that you paid your 5% towards) and your state pension (that you paid PRSI towards) would provide the total benefit of the pension scheme.
When the state pension age was increased to 66, then this created a gap for both PS and private workers, the majority of whom have a compulsory retirement age of 65, the pension schemes were designed on the assumption that the workers would be paid the state pension on the day they retired.
If you are not entitled to the state pension at 65 - then that offset has to be zero. You can't integrate something that does not exist.
Class A gets (35/80)(50k - 2(52.18)(233.30)) = 11,223 pension
I have provided the pension rules, circulars and legislation to provide you with the formula for PS pension calculations, for a 50k salary on 40 years service (as opposed to 35 years):
50k:
Weekly SCP: €233.30
Annual SCP: €12,131.60
3.333 times annual SCP: €40,438.66
1/200th of salary below 3.333 SCP for 40 years: (40438.66/200*40 =
€8,087.73
1/80 of salary above 3.333 SCP for 40 years: (50,000 - 40438.66) / 80 * 40 =
€4,780.67
Total =
12,868.40
40/80th entitlement 25,000
Shortfall =
12,131.60
I have provided the same information relating to the supplementary pension scheme and yet you ignore it.
According to the Pensions Ombudsman this is how that pension will be calculated:
Weekly SCP: €233.30
Annual SCP: €12,131.60
3.333 times annual SCP: €40,438.66
1/200th of salary below 3.333 SCP for 40 years: (40438.66/200*40 =
€8,087.73
1/80 of salary above 3.333 SCP for 40 years: (50,000 - 40438.66) / 80 * 40 =
€4,780.67
Total = 12,868.40
He believes that both the totals above equal the "integrated" pension.
A "supplementary" pension was designed to supplement the pensions of those integrated schemes where, when both the occupational and SW benefits combined - did not equal the benefit (in PS that is 50% of final salary on retirement) provided for in the scheme.
And here is the formula by a pension administrator in the PS and this formula was done in August this year:
"€56,442.54 - €40,578.63 = €15,863.91
€40,578.63/200 = €202.89*18.633424 = €3,780.59
€15,863.91/80 = €198.29*18.633424 = €3,694.99
€3,780.59 + €3,694.99 = €7,475.58"
There are many people working on this issue, for both Private and Public DB integrated schemes and they have all identified that "integration" is the problem.
@Nordkap -
The issue is the SP should along with the occupational pension be payable from retirement date. The fact is that it is not. There is clear inequality between a Class D and a Class A when they retire.
Not quite, here is the relevant part of the legislation regarding the supplementary pension:
"(3) The amount of supplementary pension payable shall be the amount, if
any, arrived at by the formula:"
The formula is above and the formula for payment of the supplementary pension is below:
"A — (B + C) where"
"
A is the amount of pension or preserved pension which would have been
payable to the former member if he or she had not been fully insured;
Using the 60k final pension again as an example, so a 30k pension - "
A" means that if the pension payable to a person on an "integrated" pension is not the same as a person on a non integrated pension (not fully insured refers to Class D members) if their pension entitlement would have been calculated as follows (Again this is in legislation):
11. Pension Calculation on Retirement
(1) A member who is not fully insured who retires having attained the minimum
pension age shall be eligible to receive a pension of an amount per annum
calculated at the rate of 1/80th of his or her pensionable remuneration at retirement
for each year of pensionable service.
1/80th of 60k = 750 multiplied by 40 years service = 30,000.
"B is the amount of pension actually payable to the former member,"
This refers to the occupational part or this part as calculated by the formula above:
Weekly SCP: €233.30
Annual SCP: €12,131.60
3.333 times annual SCP: €40,438.66
1/200th of salary below 3.333 SCP for 40 years: (40438.66/200*40 = €8,087.73
1/80 of salary above 3.333 SCP for 40 years: (50,000 - 40438.66) / 80 * 40 = €4,780.67
Total = 12,868.40
and
C is the amount of personal Social Welfare Benefit payable to the former
member."
If you are not entitled to the max state pension but you are entitled to the Job seekers rate - then this is supposed to be added to the 12,868.40, the JSB is 9776 and when added they total 22,644.40. The supplementary pension is the difference between the 30,000 entitlement and the 22,644.40.
The pension assumed however, that the member would be fully insured on retirement after working for 40 years and paying the PRSI contribution for 40 years, any PS worker would be entitled to some SW benefit.
The entitlement is 50% final pensionable salary on retirement after both the occupational and SW pension are combined.
Now, there are people who clearly do not agree with what I am saying, that is fine, but my position is backed by official documentation and legislation. It is being interpreted incorrectly.