Mattie McGrath (Tipperary, Independent) | Oireachtas source

I note that Air Force One which President-elect Trump does not want to use has all kinds of communications systems on board. Perhaps the Minister might be able to listen to debates while in the air if we get the Air Corps to upgrade the Government jet.

I welcome the motion and certainly support its intent. I am not sure, however, if it really deals with many of the major issues that will affect those who will reach pension age in the coming years and find that they either have no entitlement to a pension or are only entitled to a reduced pension at best. Far too often we meet people who are reaching pension age and worried about what will happen once they hit the age of 65 years. Many people are being forced to retire at 65 years and sign on for jobseeker's benefit, which is totally farcical. People who have always wanted to work are being forced to go to a labour exchange, which is absolutely ridiculous. While I understand people are living and working longer, something must be done to support those who are being forced to retire at 65 years of age. It is unacceptable to force pensioners to sign on to receive jobseeker's benefit having worked their entire lives. I also support the call for the State transition pension to be reinstated. It is a problem that the Bill does not indicate what the cost might be.

There is also a problem with yearly averaging of contributions. While I understand the nature of the call made to have the number of contributions required reduced from 520 to 260, I do not believe this is the real problem. It would do very little in dealing with it. The real problem is the yearly averaging of contributions. In this day and age very few people will have a difficulty in reaching the 520 contributions required to qualify for the State pension as ten years of full employment is sufficient to reach that number. In the past many women were forced to leave the workforce when they got married or chose to care for their children in the home, a decision which was commendable, but they were subsequently penalised for doing so. In the next ten to 15 years many women will discover on reaching pension age that they will not be entitled to a pension at the maximum rate, despite potentially having worked for over 30 years. This is a terrible anomaly. I acknowledge that the Government has introduced the homemakers scheme to try to cover those who chose to care for their children in the home, but the scheme does not include those who cared for their children before 1994, which is hugely discriminatory. It also only covers the care of children under the age of 12 years. We all know that rearing children between the ages of 11 and 20 years is probably the hardest and it is also the most expensive period. I am unclear as to the success of the scheme and know that there are many people who cannot avail of it and who will now struggle to receive a full contributory pension.

I have two examples to highlight the unfairness of the system. Let us consider the case of a woman, or a man, who started work at the age of 17 years and then took 16 years out of the workforce to raise her or his children before returning and continuing to work until she or he reached pension age. The person concerned will have accumulated the 520 contributions required without any difficulty but because of the 16 year gap in his or her employment record he or she will only receive a pension at a much reduced rate as he or she could have a yearly average of just 19, which would mean his or her pension payment would be reduced by €81, which is disgraceful. I ask the Minister of State to take this on board. Despite having worked for over 30 years, he or she could potentially only be entitled to a pension of €152 per week. This is an actual case with which I am dealing.

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At the same time, somebody who comes to live in Ireland at the age of 55 and works for ten years prior to reaching pension age will have no difficulty obtaining the 520 contributions and could potentially have a maximum yearly average of 48, thereby being entitled to a maximum rate pension of €230. There is a clear anomaly which needs to be checked.

Despite the fact the people in my first example could have worked for 30 years in Ireland, they have a reduced rate pension, but a person who only works for ten years before pension age could potentially have a maximum rate pension. There is an inherent unfairness in this situation, which is clear to anybody. Reducing the contributions is not the answer if we do not examine the workings of the yearly average. I do not believe reducing the contributions from 520 to 260 will do anything for these people. Instead, the focus should be on examining the yearly average, which is the problem, and how this affects people receiving their pensions.

There are many reasons people could have a break in their records. For example, if someone entered the workforce at 17 but decided to take a number of years out to return to full-time education, which happens very often now, thankfully, and subsequently went travelling, that is a break. If people lose their jobs and are not entitled to a jobseeker's allowance payment because their partner is working and they cannot sign for credits, that is a break. If people emigrated for a number of years during the recession, as so many had to, and then returned home, when they come to apply for a pension they will find that they will not be entitled to the maximum rate pension because of the gap in their record. This is very unfair. It is the yearly average that causes the greatest problems, in my estimation and in that of my office staff, and I believe these issues need to be re-examined very closely and very quickly.

The other issue is the way in which the non-contributory State pension is assessed. The qualifying income thresholds for the non-contributory State pension have not been increased in more than ten years and many people find they have no entitlement to a pension because of the income of their spouse or partner. It is time for an increase in this regard. I also have major concerns about the manner in which earnings are assessed. Any cash income is assessed in the means test, but earnings of up to €200 per week from employment are disregarded. This is not the case for self-employed people or farmers, and every penny earned by self-employed people or farmers is taken into account. This is very unfair and discriminatory.

It is time for significant pension reform. When I speak about reform I do not just mean increasing the pension age, as the Government intends to do. I do not agree with this. We must ensure fairness and equality, and there are many examples of a lack of fairness in our current system. The fact there are more 65 year olds on the dole than any other age is an insult to our retired pensioners and we must examine the reasons. This cannot be ignored. We know they are not ever going to gain employment, unfortunately, because of their age. Those over 50 constantly report how difficult it is to gain meaningful employment, so we cannot pretend that very many 65 year olds are easily going to gain employment after being forced to retire, and they should not be put in this situation. It is ludicrous to force them to go to the labour exchange, a place they never visited and they do not know where it is. I am not demeaning anybody who goes there, but they never went there. They always worked hard and it is totally unfair. People suffer greatly because of it. They are intimidated by it. It makes many people mentally and physically sick because they never went there and they do not want to have to go there. It is unfair to put them in this trap for 12 months.

Many women will not receive a full State contributory pension. The fact that only 16% of those receiving a full State contributory pension are women is a shocking indictment on a system that penalises women who took time out to care for their families. We should reflect on this. The system has to be reformed and has to be looked at retrospectively so that those who cared for their children before 1994 are not the biggest losers, which they are at present. This is very discriminatory.

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