Teacher exodus feared over changes to their pensions

THOUSANDS of teachers could be lost to early retirement next year because of threatened changes to public service pension arrangements, a union has warned.

Finance Minister Brian Lenihan’s budget speech outlined that future pension increases may be linked to cost of living rises rather than the current arrangement linking them to increases in public service pay. But changes will not affect those public servants who retire during 2010, he said.

The Irish National Teachers’ Organisation (INTO) said the move to cost-of-living increases rather than pay parity is designed to reduce the Government’s pension bill because, on average, pay increases have been greater than those in the consumer price index. The unionalso understands that while teachers’ salaries will fall by between 5% and 8% next year, the pension and lump sum entitlements of anyone retiring in 2010 will be based on salary before the pay-cut.

While increased retirements across the public service in the past year were linked to a belief that lump sum payments might be taxed for the first time, INTO incoming general secretary Sheila Nunan said the new arrangements would have a much bigger impact. “I wouldn’t be surprised if every teacher with 35 years’ service or more seriously looks at calling it a day,” she said.

Almost 2,400 primary teachers in the job for 35 years or more received a long service allowance of nearly €2,500 each in the last school year, while the same allowance was paid to almost 2,000 second-level teachers.

But while any exodus might be good news for thousands of teachers who are without work because of a surplus of recent graduates, the INTO warned that their pension benefits are also under threat from Budget 2010.

Mr Linehan announced that a new pension scheme will be introduced next year for all new entrants to the public service, basing entitlements on average career earnings rather than final salaries. Other changes include increasing the minimum public service pension age from 65 to 66.

Ms Nunan said these changes, along with the introduction of cost-of-living pension increases, will amount to a very significant reduction in pension terms for future recruits.

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