What is a supplementary pension?

In Ireland, some public service pension schemes offer supplementary pensions to help bridge gaps in your total pension benefits. But how exactly do they work, and who qualifies for them? On this page, we cover everything you need to know about supplementary pensions for public servants, and what they mean for you.

The supplementary pension is an additional pension payment available to certain retirees in Ireland alongside their public service pension plan.

To provide some context: in 1995, changes were made to how pension contributions are handled for public sector employees. If you started working in public service after April 1995, you pay the full PRSI rate (class A1) and your pension benefits are tied to your social welfare entitlements. This setup, known as a coordinated pension, is quite common in public service. The aim of this coordinated pension is to make sure that your total occupational pension and contributory state pension add up to what someone paying PRSI at the lower ‘D1’ rate would get.

So, when would you need a supplementary pension? You might need it when the total of your occupational pension and social welfare benefits falls short of what you would receive without the social welfare link. This is especially useful if you retire early or don’t qualify for full social welfare benefits.

As an example, if you have a teacher’s pension, and you retire before the state pension age of 66, you may be eligible for the supplementary pension for teachers to tide you over until your state pension starts.

Retirees who have paid full-rate class A PRSI contributions, either throughout their entire working life or for part of it, may be eligible for a supplementary pension in Ireland. To be eligible, you must retire at age 60 or later and fail to qualify for social welfare benefits, or you qualify at a rate that is less than the maximum payable.

You are eligible for a supplementary pension in Ireland if you meet the following criteria:

1. You are receiving an occupational pension. You need to have been part of an older public service pension plan (i.e. not the single scheme) where pension benefits were connected with the social insurance system.
2. You are not employed in any form.

3. You fail to qualify for social welfare benefits or only qualify for them at a reduced rate due to circumstances beyond your control. These benefits include:

   • Jobseeker’s benefit

   • Disability benefit

   • Invalidity pension
   • Contributory state pension

You will need to provide written confirmation from the Department of Social Protection that you meet the requirements under the final point.

It’s important to note that you won’t receive a supplementary pension automatically. If you think you might be eligible, you’ll have to submit an application using the relevant SUPP form. Your eligibility for this supplementary support will then be assessed.

You may be entitled to a supplementary pension for public servants if you retire early from a public service position, having been a class A PRSI contributor paying full PRSI. This applies if you’re only eligible for a coordinated pension, retire before turning 65, and have no entitlement to any social welfare benefits.

What about cost neutral early retirement and supplementary pensions? If you take advantage of this scheme, a supplementary pension may be paid, but you’ll only receive it once you reach your preserved pension age, which is either age 60 or 65. This differs from your actual early retirement age under the scheme, which is typically 50 or 55.

The supplementary pension is an extra amount you receive if your total pension is lower due to coordination with social welfare benefits. It’s calculated as follows:

Supplementary pension = amount of full occupational pension (without coordination) - (actual occupational pension + social welfare benefits)

In other words, it’s the difference between the full pension you would get if coordination didn’t apply and the combined total of your actual occupational pension and any social welfare benefits you receive. This ensures you receive an extra amount to bridge the income difference, bringing it in line with those on a class D pension.

If you qualify for a supplementary pension, payment will typically end the day before you turn 66, assuming you’re eligible for benefit payments until you reach that age. Currently, the state pension becomes payable at age 66. So, if this is still the case when you retire, your supplementary pension will cease when you turn 66.

However, there are situations where it can continue beyond that age. If you’re unable to qualify for certain social welfare benefits, including the state pension, or you qualify at a reduced rate through no fault of your own, you can apply to keep receiving the supplementary pension, although it may be slightly reduced.

If you’re eligible, you can apply to the pension unit at the Department of Education for a supplementary pension payment.

You’ll be required to fill out two application forms: the SUPP 1 and one of the following, depending on whether you are retiring before or after age 65, or on medical grounds: SUPP 3, SUPP 4, or SUPP 5.

For more information and to access the application forms, you can refer to the government webpage on supplementary pensions.

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