Removefiannafail
end corruption,stroke politics, &incompetent administration
Monkey business and Seamus Brennan
The most minute minded monkey in the ministerial menagerie collectively known as the Soldiers of Destiny-one Seamus Brennan issued another of his weighty tome of intellectually challenging, press releases in conjunction with "National Pensions Awareness Week" in May 2005.
He suggested that the meagre old age pension which is paid to the poorest workers in the private work force sector in the 66th year of their life,may be witheld by his colleagues in power due to insufficient funds availible,and they may have to soldier on labouring until reaching the ripe young age of seventy.!
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Putting aside the fact that during the same week the National Hospice Foundation which receives not one iota of his Billion + and rising yearly health budget declared that many people in this age group were dying daily in public wards with neither dignity,privacy or comfort -he was tomb silent as to why this unhappy dilemma was looming large on the life horizon, of three fifths of the unfortunate workforce.
The statistics indicate that the top 10% of earners get 40% of the tax reliefs.!
Only 50% of workers in the private sector have pensions.!
Public sector workers contribute 5 PERCENT of their salaries towards an index linked pension and can retire at 55 on an incredible TWO THIRDS of final year salary which is thereafter INDEXLINKED
for the remainder of their lives.!
BENCHMARKING is an ongoing exercise under the Fianna Fail government,and will compound this
looming financial Tsunami until crisis point is reached in the country,s finances.
.For how long can this administration rob the poorer 60% to enrich the relatively well-off 40%?
For how long can their countless stealth taxes continue to hold the ever widening chasm?
Is this division of our society into a two tier work force an institutionalised affront to the human rights of a nations work force:
"Some are born to sweet delight,
Some are born to endless night"?
All this in the same week that Bertie Ahern announces to the usual fanfare of trumpets, that he is creating a new layer of parasitical state functionaries,a crack corps of consumer protection inspectors who will "Blitzkrieg" and fine "on the spot" the numerous greedy publicans caught overcharging the thirst parched souls who seek refuge within their walls.?
David Went, CEO of Irish Life & Permanent, stated that to obtain a salary-indexed pension (like our public servants have) in the private sector would require contributions of 45% of a person's salary throughout their working life! Public servants pay around 5% of salary for their pensions.
He also stated that when consequent pension costs are included, the true cost of the last benchmarking deal was €20 billion and not €1.1 billion as is often stated.
Your childrens children will pay dearly in future years-unless of course they are among the civil service elite.
NEVER IN THE HISTORY OF POLITICAL ROGUERY, HAS SO MUCH DROSS EMERGED,WITH SO MUCH ARROGANCE,AND SO LITTLE SHAME, FROM THE MOUTHS OF SO MANY FIANNA FAIL MINISTERS.
If this pantomime was not real ,-you could not make it up.!
Going public-after buying the election!
The new monkey in charge of the sub prime pensions department.
Thursday October 18 2007 Fianna Fails plan for solving it all!
PRSI contributions will not be enough to pay for welfare benefits in just three years time, and the system will then move into huge deficits, a new analysis by pensions experts has shown.The shock assessment of the Social Insurance Fund by consultants Mercer came as the Minister for Social and Family Affairs, Martin Cullen, described the whole pensions system as unsustainable.
He was speaking as the Government launched a major discussion paper on the pensions problem, but said it is not yet willing to commit to any changes.
In a sign of the pressures which are building as the population ages and people live longer, the Government is considering an assault on "Rolls Royce" public sector pensions for future government workers.
The Government will examine the fixed link between pensions and current public sector pay, as well as calculating pension on basis of career average earnings, rather than the final salary at retirement age.
It may have to act sooner on the PRSI problem, if more of the cost of benefits such as contributory pensions and jobseekers' allowances are not to fall on general taxation.
At present, the PRSI payments have built up a surplus of more than bn, but this will disappear by 2010, Mercer say.
This is because increases in pensions and other benefits have not been matched by higher contributions.
By 2016, the shortfall could be bn a year in today's money.
"The deteriorating financial position can be traced almost entirely to the increase in benefit under the long-term schemes," the report commissioned by the Government says. Mr Cullen pointed out that the Exchequer had covered shortfalls in the past, but acknowledged that the whole pension system must raise contributions and cut costs. "To do nothing would be disastrous," he said.
On public sector pensions, yesterday's discussion document says the Government is going to look at a number of options, including raising the public service retirement age and making workers pay higher pension contributions. 
The reforms will only apply though to future appointees to the public service, as any changes for existing ones would be bitterly opposed by public sector unions.
Several sources in public sector unions said last night that the document would have to be studied in detail before issuing a response. In general, the demographic and budgetary realities "pose excessive future risk to the Exchequer", the Green Paper on Pensions says.
It is calculated that, by 2060, the average life expectancy for men will be 87 years, and for women 91 years.
The Government hopes to reach a consensus on new policies by the end of next year. In the meantime it is not favouring any options, including a SSIA-style matching contribution for each saved in a scheme.
"The best way of achieving a sustainable and fair framework is to ensure diverse voices are heard and to build further on the social partnership approach," Taoiseach Bertie Ahern said at the launch of the document.(Whatever that means?)
(Prize waffle-youll be dead Bertie (with luck) when the post offices run out of cash!
Fine Gael Social and Family Affairs Spokesperson, Olwyn Enright TD described the Green Paper as constituting Ë| pages of nothing."
"It did not contain one single concrete proposal on how the Government will tackle the looming pensions crisis.
"This doesn't move the debate on one iota since the Pensions Board Recommendations in 2006, with the Green Paper full of options and no decisions."
Age Action said it is particularly concerned that adequate pension provision be made for current pensioners.
"Half of all pensioners are currently completely dependent on the State for their retirement income. That figures rises to 60pc for those living alone," it said.
Fact is they dont have a plan
Fianna Fail,s empty hospice for terminal cancer patients.!
LARA BRADLEY
EXCLUSIVE
MORE than 5m of public money has been wasted keeping a state-of-the-art hospice facility open for the past 12 months - with not a single patient admitted in that time, the Sunday Independent can reveal.
Up to 15 highly-qualified staff, including specially-trained nurses, turn up for work at the empty North West Hospice on full pay while, on the same campus, terminally-ill cancer patients are being treated amidst the hustle and bustle of Sligo General Hospital.
The Sligo-based hospice closed "temporarily" to patients on January 1, 2005, after a number of medical staff and directors quit. It has maintained a home care service of seven nurses.
Sources say there were internal difficulties. One former staff member claimed there were "huge individual conflicts". An HSE spokesman said: "The inability to admit patients to the hospice followed the departure of two medical personnel in 2004.
"Working with the board, the HSE immediately began extensive recruitment campaigns both nationally and internationally. Until recent weeks, these campaigns had not been successful., Speaking to the Sunday Independent yesterday, one former director of the hospice, said: "There are a lot of disgruntled people out there. Staff were very stressed and having clandestine meetings to discuss their fears and concerns."
Noreen McGloin, who was chairwoman of the North West Hospice Board until December and whose son, Eugene, is the hospice administrator, refused to comment on the controversy. She said: "That would open a hornet's nest and I am not going to do that."
Sligo Labour party councillor Veronica Cawley praised the work of the hospice, which has served the community for more than a decade, but said the current situation "beggars belief".
She said: "Whatever politics are being played out in the background, this should have been nipped in the bud and the hospice should never have closed.
"People are afraid to say what is going on and the public are mystified as to how it can have been closed for so long."
Meanwhile, staff are continuing to turn up to work in the empty hospice and fundraising continues apace.
Michael McGloin, who took over as chairman in December and is not related to Noreen McGloin, said: "We have four admin staff and 19 or 20 nurses waiting in anticipation of us opening.
"They are keeping the place ready so that at a moment's notice we will be ready to accept patients. Their wages have continued as normal. The waiting is stressful for them as they would prefer to be busy."
Seven nurses have continued to provide home-care to terminally ill in the area.
The Sunday Independent can also reveal that the Irish Cancer Society, which funds the home-care nursing team, is writing to the North West Hospice asking for an explanation for the lengthy and costly closure of the in-bed unit.
CEO John McCormack said: "Staff in the hospice unit are specially trained in the care of the dying and it is a great pity that expertise is available, but is being denied to the people who need it. Many of those people are in the general hospital and that has knock-on effects on issues such as the shortage of beds."
Members of the medical staff at Sligo General Hospital last week described the situation as "a disgrace" and said that while hospital staff did their best to care for terminally-ill patients, it could not compare with hospice care.
Relatives of patients have also expressed dismay at the closure, with some angry that their loved ones have had to witness the deaths of other patients in busy oncology wards with little or no privacy - while the hospice rooms lie empty.
It cost 5.3 million to keep the empty facility open last year. The HSE contributed public money and 100,000 was provided by the Irish Cancer Society. The remainder was raised by charitable donations.
Local Councillors gravy train,
Tuesday August 01 2006
COUNCILLORS are set for an early Christmas present And some will get over 5,000 Euros more, arising from changes by Environment Minister Dick Roche.
Mr Roche is also dramatically increasing the golden handshake paid to retiring councillors to twice the average industrial wage for those with 20 years' service.
The multi-million package will significantly increase the money pie carved up by councillors last year. The increased allowances were put together after intense lobbying from Fianna Fail senators, who are mainly elected by councillors
The vast majority of the funds come from the 34 county and city councils across the country.
But this study also includes payments from eight regional authorities, two regional assemblies, eight fisheries boards, 14 colleges and six VECs.
Councillors get paid a variety of wages, allowances and expenses from a complex system.
Here is the rough guide through the cash maze.
* County and City Councils:
- Representational Payment: Every councillor in the country starts off with a salary type payment of more than €15,000.
Known as a 'Representational Payment', it was introduced in 2002.
- Annual Allowance: This payment is to cover expenses for attending meetings associated with council business as well as postage and telephone bills and is usually worth around €5,000.
- Positional Allowances: The Mayor and Deputy Mayor, or chairman and vice-chairman, get an additional annual allowance. The amount ranges up to €30,000 for the Mayor, depending on the local authority. Councillors who are chairs of Strategic Policy Committees (SPC) get a tax-free allowance of €5,078. Usually there are five SPC chairs.
- Expenses: This is where it gets really interesting. Councillors get ad hoc travel and subsistence payments for going to conferences, foreign trips, training courses and some meetings.
* Regional Authorities and Assemblies:
Each region in the country has its own regional authority, usually covering three or four counties.
Each council in that region has about five or six councillors who are members of the authority and get allowances and expenses.
The 235 councillors on regional authorities last year got paid an average of €2,885 each.
From this pool of councillors, members of the two regional assemblies in the country are drawn, who also get allowances and expenses.
* Fisheries Boards: Not a highly lucrative source of funding as there are only seven councillors on the country's eight fisheries boards. But one of them did get paid €3,500.
* Colleges: Most third-level colleges have councillors on their governing bodies - either as representatives of the council, the VEC or as Ministerial appointees. The payments vary from zero upwards but one councillor did get paid €25,000 last year.
* VECs: Every council has several members on the local Vocational Education Committee and councillors get paid allowances and expenses.
- Fionnan Sheahan
A typical profile of your up and coming overlords.
JUNIOR Minister Frank Fahey is atypical of the next generation of Fianna Fail rulers,the second ranks of the Soldiers of Destiny-unfortunately, yours and my destiny.
They are sometimes former teachers ,often part time publicans , farmers, hoteliers,auctioneers, and ambitious speculators who are invariably busier minding their own business empires than attending to the worries and needs of the majority of the people who put them in a powerful (and lucrative) post from where they can enact legislation nilly willy so that they can protect their wealth from the kind of taxation which ordinary salaried citizens are subject to.
Frank,according to newspaper reports in April 2006 had not declared an interest in a $1m-valued US property on the Dail register of interests.
The property (equivalent to ��.83m) is held by a US company in which he is a shareholder.
Mr Fahey has declared interests in other properties held by the same company.
An Irish Independent inquiry has found the Junior Justice Minister has amassed a multi-million euro property empire across the globe in either his own name or in partnership with relatives or business associates.
Many of his 20-plus properties were purchased in the US, Europe and Ireland with his wife and a company called Sage Developments.
But the former teacher-turned-politician has not declared his interest in a ��m six-bedroom house in Massachusetts on the Dail register of interests.
This property, which is situated on Perthshire Road, is registered to Fahey Higgins LLC, a Boston-based property company in which the Galway TD is a shareholder.
His declaration of interests confirms he is a shareholder in the company. But despite this the minister has denied he has any interest in the valuable real estate property.
"I don't have any interest in Perthshire Road," he told the Irish Independent.
Mr Fahey's declaration of interests for 2005 reveals his vast property portfolio which includes interests in 20 property projects in Ireland and seven more abroad. This declaration states that he is a shareholder in Fahey Higgins LLC.
He declares an interest via this company in a property at Strathmore Road and a second on Tappan Street in Boston in his register of interests.
US records show that the Perthshire property was acquired in February 2004 by the company for $1m using a mortgage of $900,000.
Mr Fahey stated that despite his shareholding in Fahey Higgins he was fully compliant with the Ethics in Public Office Acts governing members' interests as he had no financial dealings with Perthshire Road.
"My only reason for being a shareholder in Fahey Higgins LLC was to facilitate a relative borrowing money from US banks," he said.
The other shareholder in Fahey Higgins is his only daughter, who lives in America, and Frank Higgins.
Mr Fahey said he received no payment from any transaction involving Fahey Higgins LLC.
He said this included a recent deal in which the company sold two apartments at Strathmore Road for $1.4m.
These transactions took place at the end of 2004 and in the first quarter of 2005. Fahey Higgins LLC continues to own one apartment in the complex on the up-market street.
This is the second time he has been involved in confusion over property interests abroad.
In 2000 it emerged that Mr Fahey's name was on the title deeds of a property in Daytona Beach, Florida.
He explained at the time that although his name may have been on the deeds along with a friend called John Cahill he had no beneficial interest in it.
He had merely acted as a guarantor on the mortgage to satisfy a bank. But despite this he included the property on his declared register of interests in 2001.
In parallel with his political career Mr Fahey has amassed a vast portfolio of property interests in Ireland, France, Belgium, Portugal and the US either in his own name or in partnership with relatives or business associates.
His declaration of property interests in 2005 include ownership or shareholdings in 10 apartments and six houses around the country as well as shops and development land.
Mr Fahey declined to discuss his various business partners or for how much he had acquired individual properties when contacted by the Irish Independent.
He said his property dealings were "a private matter" and he was not obliged to comment.
All talk-No legislation.
In 1993, the then taoiseach Albert Reynolds wrote a letter to former Tara Mines worker Philip Cantwell after Cantwell had raised concerns with him about the Tara Mines pension and income continuance scheme.
Income continuance is an insurance policy that pays the beneficiary an income if the beneficiary becomes disabled.
And Cantwell had contacted Reynolds because he and a number of other disabled Tara Mines workers felt they were not getting the benefit they had paid for.
In the letter, the former taoiseach noted that the ‘‘whole area of income continuance plans is unregulated and is not covered under the Pensions Act. My colleague [former social welfare minister Michael Woods TD], however, has written to the Pensions Board seeking their advice on how best to deal with the whole area of income continuance plans and he awaits their advice with interest’’.
Eight years later, the Tara Mines workers were still waiting.
In 2001, RTE’s Prime Time put the spotlight on a number of disabled Tara Mines workers who discovered that the pension they were relying on for their retirement would only be a fraction of what they had expected.
The programme explained that the mine workers had bought an income continuance policy which would provide them with an income if they became disabled. This insurance policy was seen as particularly important to workers in an industry where serious accidents are not uncommon.
The workers understood that the proceeds of the income continuance policy would not only provide them with an income while they couldn’t work, but would also allow them to continue to contribute to their pension scheme. Crucially, they understood that the proceeds of the policy would provide pension contributions increasing each year by 5 per cent compound until age 65.
But Tara Mines did not honour this alleged commitment.
This resulted in claims from the workers that their pensions were falling way short of what they believed were their entitlements. Tara Mines disputed the workers’ version of events, but under pressure from a group of disabled workers led by Cantwell and their trade union representatives, the company had offered a compromise.
Under the terms of the compromise, the company said it was escalating the pensionable salaries of people on income continuance in line with the actual pay increases given to serving Tara Mines employees. But these increases fell short of the increases the workers claimed they were promised under the scheme, and which they said they had paid for.
Cantwell - who is now an independent councillor with Meath County Council - reckons the pensions of around 80 Tara Mines workers on income continuance are still €10,000 a year lower after the compromise than they would have been if the workers had secured the deal to which they believed they were entitled.
Cantwell told The Sunday Business Post this had the effect of boosting the value of the Tara Mines company pension scheme at the expense of the disabled employees who paid for the income continuance policy. He estimated that the coffers of company pension schemes in Ireland may have been boosted by as much as €300 million at the expense of disabled workers, a figure which was also mentioned by Green Party TD Dan Boyle in the Dail recently.
One of the main points made by the Prime Time programme was that the Tara Mines disabled workers were effectively in a regulatory limbo, as the income continuance scheme did not fall within the regulatory scope of the Pensions Ombudsman whose office was then about to be established.
That is because income continuance is technically an insurance product, despite the fact it is pensions related.
Incredibly, five years after the Prime Time programme was broadcast, these issues remain unresolved.
Earlier this summer, Cantwell appeared before the Joint Committee on Social and Family Affairs to explain that the disabled workers are still fighting for the benefits to which they believe they are entitled and that they are still effectively in a regulatory limbo. Certain aspects of the row between the disabled workers and Tara Mines are currently before the courts.
But regardless of the outcome of that court case, it is deeply disappointing that successive ministers have failed to regulate to prevent the re-occurrence of a situation that appears to have resulted in great hardship and distress for the disabled workers involved. There are an estimated 238,000 workers insured under income continuance schemes in the country, according to figures obtained by the Green Party.
Pensions Ombudsman Paul Kenny also appeared before the joint committee earlier this summer to explain the dilemma in which the Tara Mines disabled workers and others reliant on income continuance schemes find themselves. He did not mince his words.
‘‘There are thousands of members of income continuance plans, but only a percentage of those will become disabled. However, nobody knows who these will be. As there is no regulation, there is no guarantee of uniformity of treatment. One person might be lucky enough to work for a person who operates an income continuance plan with open access to information and who treats members fairly, but another might work for a company that believes its income continuance plan is governed by the Official Secrets Act,” Kenny told the committee.
Kenny also told the committee that income continuance schemes did not fall within his regulatory scope or within the scope of the Financial Services Ombudsman.
‘‘Therefore, there is no possible avenue of redress for any person who suffers a loss due to the maladministration of a company-sponsored income continuance plan. Neither is there any regulation of those plans. They do not fall under the supervision of the Pensions Board and the Pensions Act does not apply to them.
‘‘There is no automatic right to information on such plans, as would apply to information on a pensions scheme to which the Pensions Act and the regulations under the act apply. This is a sector of activity covering employee benefits which, effectively, is totally unregulated,” he said.
‘‘A report was prepared for the Pensions Board at the request of the Minister for Social and Family Affairs some time ago by Watson Wyatt and Matheson Ormsby Prentice.
“It is not in the public domain and it is not clear what plans there may be to regulate income continuance plans, but it is my firm conviction that they must be covered by some form of regulation because the current position is unsatisfactory,’’ Kenny said.
Others at the committee expressed fears that the lack of regulation could allow a company to discriminate against some workers such as active trade union members.
Meanwhile, Cantwell and the disabled Tara Mines workers are still writing letters to the taoiseach of the day.
On July 31 this year, 13 years after their correspondence with former taoiseach Albert Reynolds, they wrote to Bertie Ahern asking him to legislate ‘‘to protect workers income and pension benefit rights arising from income continuance plans’’ and to carry out an investigation into the dispute at Tara.
At a time when Seamus Brennan, the Minister for Social and Family Affairs, has been hogging the headlines with his talk of mandatory pensions, it seems extraordinary that he and his predecessor s have allowed this appalling situation to continue for so long.
If the government wants employees to act on its advice to take out private pensions and related products, it must at the very least ensure that employees can have confidence in those products and confidence that the regulatory system is capable of dealing quickly, fairly and competently with any disputes that arise.
Otherwise, employees may be left with the impression that their pension contributions are being unfairly used to swell the value of company pension funds or to boost the pensions of favoured employees at the expense of others.
More ado about a two tier society.
Public sector pay - Outrage not only about money
LAST week, just as Transport Minister Noel Dempsey struggled to explain why he did not know what was going on in his department about Aer Lingus proposals for Shannon, the person blamed for the oversight — rightly or wrongly — found a ready-made source of comfort.
In that same week, culminating for Mr Dempsey in yesterday’s stomach-churning climb-down on provisional driving licences, the department’s general secretary, Julie O’Neill, was awarded a pay rise of €58,234.
This represents an increase of 27.5% and brought the official’s salary to €270,000 a year, €30,000 more than the minister’s.
As anybody facing into the traffic chaos that separates their home from their work tomorrow morning — whether holding a provisional driving licence or not — will attest, that is not the case. Neither will anybody dependent on public transport. Neither will anybody waiting for the oft-trumpeted rejuvenation of commuter rail links. Neither will anybody trying to run one of the country’s airports.
However, it would be unfair to focus on Ms O’Neill’s circumstances in isolation.
The entire system of how public servants and politicians reward themselves has gone off the rails. Even during a time of excess it has divided the country into two distinct categories of citizenship.
One is dependent on consistently delivering results and rewarded accordingly. These people live their lives in an ever-changing and increasingly unforgiving environment, their lives shaped only by delivery or failure.
The other category remain blissfully untroubled by performance reviews as they contemplate the prospect of a bullet-proof, inflation-linked pension. A pension realised after a career path defined by length of service rather than excellence. At the same time they know that they, no matter how incompetent or unsuited to the job they find themselves in, are as likely to be fired as the Queen of England.
Last week’s report from the review body on higher remuneration concluded that the lowest-paid public servant under its remit should earn €114,851 — 41.5% more than the president of France. An assistant secretary will earn €151,000, more than Ben Bernanke, the chairman of the US Federal Reserve.
If this was only about money the outrage would quickly become just one more reason for resignation and, at worst, fester into the cynicism that undermines any notion of valued citizenship and social equity. Sadly, and dangerously, it has become more than that.
Last week Finance Minister Brian Cowen — his pay rise worked out at 15.6% — suggested that we should anticipate a more challenging economic environment.
The Taoiseach, now the highest-paid OECD leader, again warned of the impact wage demands would have on our competitiveness. It must be assumed that they did this with straight faces and expected us all to take their advice rather than follow their example.
Such audacity brings to mind the performances of Charles Haughey, telling us — almost with a tear in his eye — that we might have to tighten our belts as he ordered another batch of Charvet shirts.
This self-serving munificence is the result of the arrogance that manifests itself if power remains in the same hands for too long. Even the prospect of change after Mr Ahern steps down has been removed, as all of his prospective successors have sipped from the same cup.
Time was that we had one law for the rich and another for the poor. Now it seems we need a third, one for higher public servants. However, if such tremendous pay increases become the norm the original two will soon enough again suffice.
www.sarahcarey.ie
"I was once in the company of a junior minister who was asked when a committee he had established was going to reach a decision on a particularly thorny issue. The minister guffawed with laughter and said: “I thought it was my job to make no decision for as long as possible.”
Despite the fanfare around the launch of the government’s green paper on pensions, I am suspicious that the “dialogue” which it purports to open is nothing more than another delaying tactic. Delaying what, I wonder?
A report from the National Pension Review was submitted two years ago to the then minister for social welfare, making several detailed recommendations which presumably will be implemented. So if the “dialogue” has already taken place, what are we supposed to be discussing? I smell “consensus building” for mandatory pensions.
Brian Cowen, the finance minister, insists that there are many possible “difficult options” which must be discussed “openly and honestly”. But I suspect this is really a softening-up exercise to force me into buying a product I do not want.
I’m one of the 50% of the Irish workforce without a pension, and I have no plans to get one. I take this position for two reasons. First, because of a mortgage and childcare, I can’t afford to do without another large chunk of my income. Second, whatever I can afford to save I am not giving to already overpaid, crystal ball-gazing executives who are having a ball with billions of euros from their customers’ pension funds.
This doesn’t mean that I’m not making provision for my old age. I put money in a savings account, I’ve bought some shares which are coping well despite the current upset in the markets. I intend to invest in property and I’ll eventually own my house. Throw in the free bus pass, the medical card and the fact that I intend to work until I drop, and I think I’ll be fine.
The worse case scenario is that I might not turn into one of those perpetually holidaying “actively retired” consumers in the pension ads. I think I’ll cope without a tan or capped teeth. I want to pay for my retirement without buying the financial product known as a pension. They cost too much and come with so many restrictions that their benefits are limited.
Though the government and salesmen sing the same tune, some experts in the pensions area back up my suspicions. One is Albert Dawson who has been an insurance broker for over 40 years. He has calculated that any tax savings made from contributing to a Personal Retirement Savings Account (PRSA) are wiped out by the commissions paid. The fees relating to PRSAs were capped, in order to attract more takers, but they still amount to 5% at entry and 1% of your whole fund – not just the contributions – annually.
When the fund matures you can’t just cash in and run off to Bermuda. Regulations stipulate that you take only 25% as a lump sum and the rest must be used to buy an annuity, or yearly income, which is subject to tax. That’s when the real party starts for the fund managers. From then on they get a yearly commission for looking after your pension fund.
Half the workforce share my reservations, and the state will have to figure out what do with us because the “difficult option” of buying a pension isn’t going to run. Anway, I thought by paying tax I was paying into the Old Age Pension. Where’s that money going? I have a suspicion - but I’ll get to that in a minute.
The two loudest participants in the “debate” so far are the government and the pensions industry. Well, you can see which way the industry will go: more pensions. More commissions for us, and all subsidised by the state. At least we can’t accuse them of having a hidden agenda.
Ministers and civil servants are quite happy to lecture us, but you won’t catch them investing in a pension. When they refer to the pensions “time bomb” they forget that they detonated a pretty large bomb themselves when they negotiated public sector pensions. Because when a public servant retires, his pension is based on final salary, and is linked both to inflation and the ongoing salary of the grade at which they retired.
“Open and honest” didn’t feature when the benchmarking authority granted significant pay increases to the public sector, which meant everyone on a public sector pension got a 9% rise too. The cost comes directly from current government expenditure. That’s where your tax euros are going: not for your OAP, for theirs.
These pensions are so valuable that the Central Statistics Office has calculated that a public-sector salary is worth 45% more than a private-sector one. A private sector employee would have to put aside 28% of their income for 40 years to build a pension that would match a public sector one. The public service pension bill is projected to rise from 1.3% to 4% of GNP by 2040-2050. But can you see the “debate” concluding that the first “difficult option” will be doing something about that? Or will they just get straight to the bit where I’m forced to sign up with Irish Life or Eagle Star?
Benchmarking should, of course, be abolished. Public servants’ compensation for being paid less than the private sector was a good pension. So they should be getting sub-private sector wages. Instead, due to benchmarking, they’re actually earning more.
There must be no mandatory pensions and no mandatory retirement age for the rest of us. If I’m fit and healthy at 65 and want to keep working, why shouldn’t I? I don’t want to be told when I’ve a good 20 years left in me that I’m no use to anyone. Retirement should be a choice. If you want it, take it. If you don’t, see you Monday.
So forget about tax write-offs for pension payments. The state is simply subsidising the pensions industry even though ordinary workers have rejected their bad products. What we did like was the SSIA system. I put in four euro, the government chips in one, and not a penny goes to fund managers. That transparently puts money into our pockets and subsidises me instead of an insurance company.
While I await the result of the green paper “dialogue”, I think I’ll apply for a public sector job. Maybe I’d like a tan after all."
The real cost of every uncivil public "servant"
Oct 2007: BECAUSE of escalating costs the pension of a single teacher could cost the State up to €1m.
The civil servant pensions bill is set to increase by a staggering 75 per cent over the next 10 years.
In 2005, the entire public sector pensions' bill came to €1.4bn. But by 2015, even before inflation or a single extra public sector worker is factored in, this will have risen to €2.4bn.
According to Mark Fielding of the Irish Small and Medium Enterprises Association (Isme) the country is now facing a "public service pensions' tsunami".
When the rest of the public sector workers in Education, Health, Justice and Defence, who all enjoy similar pensions, are factored in, over €1bn extra a year will have to be found.
Isme believes that "we are facing an escalating public sector pension black hole where the cost of a single primary school teacher is €1m."
Brian Cowen has claimed the National Pensions Reserve Fund will deal with this issue.
To date, the fund, which requires the payment of 1 per cent annually of GDP, has reached €18.8bn. However, Isme believes we are rapidly reaching a scenario where "the fund will barely keep pace with the requirements of public sector pensions".
Speaking to the Sunday Independent Isme's Mark Fielding noted that when the pension fund was originally established "the government claimed 66 per cent of it would go to all workers and 33 per cent to the public sector".
However, since then, there has been a "U-turn where the divide is now 50/50". The director noted these figures indicated there was an urgent need to reform the "basis of public sector pensions which is based on an act of 1832". Fielding also accused politicians of failing to factor in the pension implications of "the thousands of new gardai, nurses and consultants they are promising into their budgetary calculations".
He noted that seeing as every €1 spent on bench-marking or new employees contains "a hidden 25 per cent pension surcharge" this was an irresponsible attitude that would have incalculable consequences for future generations.
