On the basis of the redundancy terms mentioned today these redundancies will only have a payback in the fifth year after the individual vacates their job.
As I understand it the terms are as follows:
Individuals will recieve an immediate pension with no acuarial reduction.
Individuals must sign up to go by mid Novemeber 2010 and leave by the 31st December 2010.
Individuals availing of these terms must be 50 years or over by 31st December.
Lump sum to be based on 3 weeks pay per year of service and capped at 2 years salary.
Individuals will also receive statutory redundancy terms if eligible.
Take an example of an individual on 60 k a year who is 55 years of age and has service of 35 years. The costs and savings to the HSE ( the exchequer) of this type of individual availing of the terms would be as follows.
Year Costs Savings
1 lump Sum of -----------------------120k Salary 60k
Statutory Redundancy payment----- 42k
Pension -----------------------------30k
2 Pension -----------------------------30k Salary 60k
3 Pension-----------------------------30k Salary 60k
4 Pension ----------------------------30k Salary 60k
TOTAL AFTER 4 YEARS 252K versus 240K
N.B THESE FIGURES DO NOT INCLUDE THE MASSIVE COST OF BACK FUNDING THE PENSION COST OF PAYING OUT A PENSION TO SOMEONE 10 YEARS EARLIER THAN NORMAL.
So its only in the 5th year after the person leaves their job that any savings accrue to the State and thats on the far from certain basis that there is a real job saving i.e not replaced by a contractor or consultant and that those staying on in the HSE absorb any residual work.
Sound like to me that we are once again spending money without getting any real gain
As I understand it the terms are as follows:
Individuals will recieve an immediate pension with no acuarial reduction.
Individuals must sign up to go by mid Novemeber 2010 and leave by the 31st December 2010.
Individuals availing of these terms must be 50 years or over by 31st December.
Lump sum to be based on 3 weeks pay per year of service and capped at 2 years salary.
Individuals will also receive statutory redundancy terms if eligible.
Take an example of an individual on 60 k a year who is 55 years of age and has service of 35 years. The costs and savings to the HSE ( the exchequer) of this type of individual availing of the terms would be as follows.
Year Costs Savings
1 lump Sum of -----------------------120k Salary 60k
Statutory Redundancy payment----- 42k
Pension -----------------------------30k
2 Pension -----------------------------30k Salary 60k
3 Pension-----------------------------30k Salary 60k
4 Pension ----------------------------30k Salary 60k
TOTAL AFTER 4 YEARS 252K versus 240K
N.B THESE FIGURES DO NOT INCLUDE THE MASSIVE COST OF BACK FUNDING THE PENSION COST OF PAYING OUT A PENSION TO SOMEONE 10 YEARS EARLIER THAN NORMAL.
So its only in the 5th year after the person leaves their job that any savings accrue to the State and thats on the far from certain basis that there is a real job saving i.e not replaced by a contractor or consultant and that those staying on in the HSE absorb any residual work.
Sound like to me that we are once again spending money without getting any real gain