Kathleen Lynch (Cork North Central, Labour)

I thank Deputy Fleming for putting down the amendment. He is correct as the gap between the 20% level and the 38% level relates to indexation and the later pension age. It is no great secret. The table is based on assumptions.

As we are all very much aware, when we deal with pensions we can only work on assumptions because they are in the future. We must make assumptions of a certain nature; they do not always turn out to be correct but we have to make them.

I do not accept, and neither does the Minister, Deputy Fleming's assertion that the link between future pensions and the CPI will have a detrimental effect on pensions 30 or 40 years hence, because the contribution people will make during their career will also be indexed linked to the CPI. Therefore, it is not so much a negative measure but will inflation-proof contributions and the eventual pension received as one exits from one's career. This is the essential point. I know the Deputy did not mean to gloss over this, but as contributions are made year by year they will be linked to the CPI so the contribution and the final ongoing payment will be inflation-proofed and this is how it will be. I am sure this will not be the last piece of legislation on the issue. Given the state of the country and as we look to the future it is a sensible arrangement.

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