State pension fund ‘raided’ to pay for pandemic unemployment payments


#1

According to the Sunday Times, it looks like the “billions of euros’ worth of PUPs are to be recouped from the social insurance fund following the passage of new legislation last week.”. The link to the article is here: https://www.thetimes.co.uk/edition/ireland/state-pension-fund-raided-to-pay-for-pandemic-unemployment-payments-j6h7gbswx


#2

How long before private pensions are raided in order to pay civil servants to sit at home ?


#3

So in the last recession the Social Insurance Fund (SIF) went into deficit as we were paying more on Jobseekers and Pensions than PRSI income from tax payers.

The balance came from the Exchequer via subvention from the main social protection account.

There is no dedicated fund for state pensions. So the state pension fund isn’t being raided. It is pay as you go from the annual voted expenditure of the Dept.

2018 and 2017 accounts
https://www.dsfa.ie/en/pdf/SIF2018.pdf
https://www.dsfa.ie/en/downloads/SIF2017.pdf

A recent overview is here

C&AG have a report on funding the SIF here

Irish Government Economic and Evaluation Service have a report here

An actuarial review is requried every 5 years, latest is here


#4

That’s a good point. But we have known that the PAYG system is unsustainable for at least 20 years and I think that people would reasonably assume that at least some of the surplus was to be used to help pay our pensions in future years. This will have to be replenished in the next few years, so I think it is a raid of sorts and the second raid in 10 years e.g. remember the national pension reserve fund. It may also make people suspicious of the planned for compulsory private pension contributions going forward, which may now be regarded as just another tax to be used when the next crisis appears.