The Government has again extended the deadline for staff in the public service to retire if their pensions are to be calculated on the higher salaries in place prior to the cuts introduced under the Haddington Road agreement.

Minister for Public Expenditure and Reform Brendan Howlin said the new deadline is June 2016.

He said the new date of June 2016 was chosen “to minimise impacts on schools in particular”. He said it also coincided with the scheduled expiry of the Haddington Road agreement.

The Department of Public Expenditure and Reform said public service staff who were most likely to consider retiring - and availing of the extension to the deadline - were those aged over 60 and also those within one or two years of the minimum retirement age, who may opt for an actuarially reduced pension.

It said the main considerations giving rise to the granting of the extension related to workforce planning and impact on services.

Substantial retirements

It said that if no extension was to be granted, it could prompt the retirement this summer of substantial numbers of staff at senior levels, including office holders, medical and other specialists, as well as those at managerial ranks.

Mr Howlin said: “Concerns have been raised with me by both public service management and unions regarding the potential impact of the loss of key managerial and specialised staff at a single point in time where many would, in any event, need to be replaced to maintain vital front-line services.

“Such an exodus of senior staff would also carry with it the short term financial effect of once-off superannuation costs.”

The Government had originally set a deadline of August 2014 for staff to retire if their pensions were to be calculated on pre-Haddington Road deal pay rates. However, in April last year it extended that date to the end of June 2015 before deciding on Tuesday to extend it further to June 2016.

The Department of Public Expenditure and Reform said that under the Haddington Road agreement, which came into effect in July 2013, public service pay rates for those earning more than €65,000 per year were reduced 5.5 per cent or more.

“Retiring within the extension period will allow an affected public servant to benefit from superannuation calculated at the pre-cut pay level. However, the pension is then subject to a reduction under the same legislation of between 2 per cent and 5 percent , which reduces the benefit.”