Willie O'Dea (Limerick City, Fianna Fail) | Oireachtas source

I thank the witnesses for appearing before us and for the excellent presentations made by the three groups that will be of assistance to us in the forthcoming debate on the budget.

I will start with the presentation made by the National Women's Council of Ireland. Members on all sides of the Houses have raised the anomaly continually in the Dáil. I proposed legislation to backdate the homemaker's scheme back to 1974. It was not possible to progress it, of course, because Opposition Members cannot put forward money Bills, which place a charge on the Exchequer. I was curious to know how much it would cost and I got an outrageously large figure from the Minister. I have not been in a position to test it yet.

I cannot even remember what it was. The Minister was saying that rather than spending all of this money on backdating and correcting what is admittedly an anomaly, he would prefer to put it into pension increases. He followed up on that by saying he wants to move towards the total contribution system. It would appear from the questions we have been asking that the total contribution system is a long way off and that in the meantime the anomaly continues. I notice from the figures produced by Age Action that each year, more people are affected by this particular anomaly and that the percentage of woman affected continues to grow. It is now up to about 65%. This is clearly discriminatory. In view of the fact that this total contributions scheme remains in the ether we are going to have to return to this now in the context of the forthcoming budget.

Ms Ní Chaithnía mentioned in her opening statement that "While the State contributory pension payment was protected during the recession, the non-contributory pension[...] has been steadily eroded." I was under the impression that the position was more or less the same for both pensions, that neither was increased to provide for inflation and that 80% of the accompanying allowances such as free ESB and so forth were abolished. I thought that both categories of pension were equally affected, contributory and non-contributory.

What does Ms Ní Chaithnía have in mind on the issue of the universal pension? Would it be something along the lines of that proposed by Mr. Kavanagh, whereby everybody would get more or less the same pension regardless of how many contributions they had or had not made? We would need an adjustment to the tax system to pay for that so I am interested in the witness's proposal that this be covered by standard rating. That is something that we would certainly look at.

Mr. Berney mentioned several rates of inflation. The Vincentian Partnership for Social Justice has done some work particularly geared towards pensioners. It has outlined, for example, a typical basket of goods that a pensioner might purchase and measured it against inflation. The published general rate of inflation includes increases in the cost of Ferraris and jets and the like, goods in which we are unlikely to find many pensioners investing. The inflation rate for pensioners' typical purchases is actually substantially in excess of the general inflation rate. I agree with Mr. Berney that we should look for a suspension of the policy to increase the pensionable age to 67 in 2021. Many of my constituents and many of the people I meet are of a certain age and are extremely worried about this. They are constantly bringing it to my attention. I think we should have a debate on this and I agree with Mr. Berney's proposal that it be suspended pending that consultation.

I also thank Mr. Kavanagh for his extremely useful presentation. Ministers are constantly telling us that we are facing a terrible demographic time bomb. When I recently suggested to the current Minister that she would have to increase pensions in the budget, she told me that it would cost €100 million just to stand still because more people are becoming pensioners. Mr. Kavanagh is basically saying that everything will balance out because such a proportion of the population is young. We are also constantly getting scary figures about the dependency ratio between people over 66 and workers, which one is told is currently 1:6 but will reach 1:2 by 2050. Mr. Kavanagh obviously disputes that. I would like some further detail on this matter. Perhaps Mr. Kavanagh could refer me to some further documentation or reports on this.