Joan Burton (Dublin West, Labour)

The challenges facing the Irish pension system are significant. The population share of those aged 65 and over is expected to more than double between now and 2050, from 11% to 26%. People are living longer and healthier lives with average life expectancy set to rise even further in the future, up to 88 years for women and 83.9 for men. In contrast, the share of the working age population is projected to decline gradually from 68% to 58%. There are currently six people of working age for every pensioner and this ratio is expected to decrease to less than two to one by 2050. Therefore, the task of financing increasing pension spending will fall to a diminishing share of the population who are at work. Spending on public pensions, that is social welfare pensions and public service occupational pensions, is projected to increase from approximately 5.5% of GDP in 2008, to almost 15% by 2050. For these reasons, State pension age will be increased gradually to 68 years. This will begin in 2014 with the standardisation of State pension age at 66. The State pension age will be increased to 67 years in 2021 and to 68 in 2028. It is worth noting that until the early 1970s, the qualifying age for the State pension was 70 years. The legislative changes being included in the Social Welfare and Pensions Bill 2011 also fulfil one of the commitments in the EU-IMF programme of financial support for Ireland.

Additional information not given on the floor of the House.

The risk of fuel poverty is based on a combination of fuel price, income and efficiency of housing. My Department assists low-income households with heating costs through their basic payments and through the means-tested fuel allowance scheme. This scheme has been improved significantly in recent years, including through an extension in the number of weeks paid and increases in the rate. Fuel allowance is paid to people who are dependent on long-term social welfare and unable to provide for their own heating needs.

People affected by the increase in pension age who are not in employment may still qualify for the fuel allowance if they are in receipt of another qualifying social welfare payment, such as disability allowance. Under the supplementary welfare allowance scheme, a special heating supplement may be paid to assist people in certain circumstances who have special heating needs because of ill health or infirmity. In addition, exceptional needs payments may be made to help meet an essential, once-off cost that an applicant is unable to meet out of his or her own resources.

See this speech in context