PokéBase - Pokémon Q&A
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Self explanatory, I hope. I heard it as a rumour somewhere before, and I noticed that after Static takes effect in Pokemon Y that my Pikachu suddenly outspeeds.

If yes, by how much, and what gen was this implemented?

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This is indeed true. Paralysis lowering Speed has been around since Generation I, but the amount it decreased was reduced in Generation VII.

Additionally, its Speed is reduced to 50% of its previous value (25% prior to Generation VII).

Source

Hope I helped!

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Isn’t it 75% prior to gen VII? Also, it may be worth noting that baton passing a paralysed Pokémon in gen II will leave the Pokémon that is sent in paralysed, but the speed reduction doesn’t take place until a move that directly affects the speed is used.
It was reduced by 75%, or to 25% of its total speed like the answer says.