Joan Burton (Dublin West, Labour) | Oireachtas source

The last actuarial review was carried out by a big firm of accountants; I think it was KPMG. The review was carried out not long after I came into office, so it was at the height of the employment difficulties. Much of it was based on the then unemployment figures. The deficit in the fund had grown alarmingly at the beginning of our term, up to nearly €2.8 billion. We started the process of getting people back to work. After a period, if not immediately, anyone who gets back to work begins to pay PRSI, as does his or her employer, and people who go into self-employment pay their self-employment contribution. Once the balance is changed between people on the live register and people going back to work, which is what we are doing now, it has an enormous tonic effect on the Social Insurance Fund. Members will recall that when the troika presented its forecast of the position for this year it did not forecast anything as good as the outturn we have had. It still anticipated cuts, if I remember correctly, of about €1 billion this year. It anticipated interest costs of €11 billion this year, but we have got that down to less than €7 billion. Its forecast for unemployment was far worse than what we have actually achieved. The people doing the actuarial review would have been influenced, obviously, by those forecasts. The actuarial review will commence next year, as required by legislation. As we are coming into an improving period, it will show those improvements but it will also reference the fact that we are spending €200 million a year - that is, €1 billion every five years - for the extra retired people who have a retirement pension.

That is €1 billion every five years for the extra retired people who have a retirement pension. That will not change. In fact, if anything the cost of that will increase. We also have to factor in what I hope will be rate increases for pensioners. We were able to provide a rate increase this year of €3 per week which is the first rate increase since 2009. We were also able to bring back the Christmas bonus, again the first time since 2009. Also pensioners of a certain age or of limited income who receive the fuel allowance will also get an additional €2.50 per week from 1 January. It is quite a significant onward cost. Obviously, quite a few pensioners are carers. Carers will also receive the respite care grant which will be reinstated at €1,700. I anticipate that as economic progress continues we will continue to provide - that is my ambition - for rate increases for pensioners so that will be a charge on the fund. We must remember that money is spent largely in Ireland in the domestic economy. This is good in terms of retail businesses and services businesses in particular.