Éamon Ó Cuív (Galway West, Fianna Fail) | Oireachtas source

First, I reiterate that I am fully aware that Ethel Buckley was not in agreement with raising the pension age. I therefore know I am speaking to people who are of the same mind as me. Let us get that on the record again.

I am fascinated with the debate on affordability and our choices, as though PRSI and social welfare were self-financing arrangements. They are not, of course. For many periods, and I am not talking about the crisis periods in more recent times, such as in the past two years, but about when pensions were initially introduced, the Exchequer always contributed to the pension. Not only that, there was a much higher percentage of non-contributory pensions in those days than there are now. This is because a higher proportion are getting contributory pensions. The non-contributory was always 100% Exchequer-funded.

The world is our oyster in how we fund this. We could raise PRSI. I would argue to people and to anybody who comes to me that PRSI is probably the best value pension policy ever bought into. We are saving at today’s rates. I often say I started working for £16 per week. Then, I was paying the same percentage in the stamp duty. It was a physical stamp in those days. It would not put much into my pension fund now. The great thing about the pay-as-you-go system is that it is in today’s money today. You are getting paid back out in today’s money because somebody else is funding in. That is one way.

The second way that is obvious and is mentioned in the report is that the PRSI self-employed rate be increased because it is, on average, actuarially the steal of the century in value terms.

The third way is that we honour the promises that we gave - I was there and the Chairman was in opposition - when we said that the USC was a temporary phenomenon and that we would replace it by putting more into the social solidarity fund if necessary. It was to be a temporary expedient to get us over the crash.

There is also Exchequer funding. One could hypothecate any amount of funding that could be sourced from wealth or whatever and, therefore, that sourcing would not hit the ordinary person. Some €10 billion in Exchequer funding goes in every year, including this year. Exchequer funding into the social welfare system amounts to slightly less than 50% of the overall system.

In looking at the whole maw, what is the right decision for pensioners and those who are ageing in society? How do we respect them? Let us then see how to fund that decision without limiting how we do so. Why constrain ourselves with arbitrary rules? I would be interested in the witnesses' views.

It seems that what is being proposed is being justified on some principle of social solidarity. Thankfully, the majority of people who are young now will get old, so it is not really a question of intergenerational solidarity. Young people are being told that, if they are generous today, they will get their turn tomorrow. They are not being told to give and that they will never get it back. They will of course get it back when they reach the necessary age. Unfortunately, it creeps up on us all a little faster than we thought. In my opinion, social solidarity with older people means someone who reaches that age cannot be automatically expected to work, can retire and still have a modicum of income, and social solidarity from my generation to the younger generation should be that we insist on affordable housing, good childcare and elements such as Student Universal Support Ireland, SUSI, grants. I mention the last two elements in particular, given that children are our future. In other words, I do not believe that this version of intergenerational social solidarity is the paramount one. It is a reordering of our society in a much wider way than just penalising age. I would be interested in knowing how the witnesses view this point in terms of helping people of working age, particularly those with families. Let us be honest about it, in that children are the future, so if we are really interested in intergenerational sustainability, we must make them affordable, to put it bluntly in economic terms. Are we overly confining this debate about what we fund, how we fund it and how we realise intergenerational solidarity compared to the way it seems to be laid out in the report, which proposes that we do this not because we would like to do so but because we must do something for younger people and cannot put the burden on them? It would not be put on them, though. If they make a small extra contribution, it would be like they were putting that into their own private pension funds and reaping the benefit when they got to 66 rather than 68 years of age. According to social statistics, the vast majority of them will get there.