Madam, - Niall Shanahan of the Impact trade union (August 1st), in response to my article of 25th July ("State must act quickly to avert crisis over public sector pension liabilities"), has highlighted that in his view the public sector is doing its bit on pensions reform.
He is correct in stating that those joining the civil service since 1995 now make a direct contribution to their pensions - about 6 per cent of salary - and also that those joining the public sector since 2004 enjoy less favourable early retirement options. However, he fails to mention that those civil servants who now make a contribution to their own pensions are actually reimbursed for this in the form of a higher gross salary.
It is also important to recognise that, despite very modest reforms in recent years, about 60 per cent of public sector workers continue to enjoy the more generous pre-1995 pension benefits. According to the Minister for Finance, the scale of public sector deferred pension liabilities is €45 billion. These need to be capped and more radical reforms introduced.
The central issue in this debate, however, is that public sector pensions are much more valuable than pensions generally available in the private sector, and the forthcoming benchmarking exercise must fully account for this premium in its deliberations on public sector pay. - Yours, etc,
BRENDAN McGINTY, Director, Industrial Relations and Human Resource Services, Ibec, Dublin 2.