Oireachtas Joint and Select Committees

Wednesday, 17 May 2017

Committee on Budgetary Oversight

Pre-Budget Submission: Age Action Ireland

2:00 pm

Mr. Justin Moran:

I will deal with those three points. On the question of whether we had a response or an indication from the Minister that the Government would backdate to take account of the 2012 cuts, we have not seen that. The position seems to be that while the Government acknowledges that there are anomalies created by the averaging system, and we would say they are much more than anomalies, these would be addressed by the total contributions approach which the Department hopes to roll out in 2020 or 2021. Many members would have been affected by the 2012 cuts. When they write to the Minister or a Deputy writes on their behalf, that is the response that comes back. The problem with that response is that even if that resolved the issue, people are losing income for three years - assuming it comes out in 2020; second, we are not clear what the total contributions approach will look like. The Minister for Social Protection, Deputy Varadkar has been quite clear about saying that there would be winners and losers from the move to that system.

In the medium to long-term future of the State pension, how the total contributions approach is calculated and how it will work and how it will be effective is important, but we do not see any move to try to reverse these cuts. Raising the issue with the budget scrutiny committee is part of our campaign to try to get that issue addressed.

In 2013 about 94% to 95% of people over 70 years got a medical card. I know that by 2015 that had dropped to 80% coverage, which is a pretty substantial decrease. To pick up on two points raised by Deputy Boyd Barrett, the medical card limits do not rise with the rise in the State pension, so that in the past number of years, there have been two increases in the State pension, a €5 increase delivered in March and a €3 increase delivered in the preceding year. If a person had a gross income of €495 and was just under the medical card limit, the State pension increases push the person over the limit and one could potentially lose the medical card on that basis, unless one was to apply for a discretionary card. If the Deputy spoke to some of our members who were in poor health, and told them one could have an extra €5 income or a medical card, the majority of those in poor health would want the medical card.