Alice-Mary Higgins (Independent) | Oireachtas source

I move amendment No. 4:

In page 8, between lines 13 and 14, to insert the following:"13. The Principal Act is amended by the insertion of the following section after section 178F:

"178G.(1)The Minister shall, not later than 9 months of the passing after theSocial Welfare Act 2016, cause to be produced a report in respect of the gender pension gap in the first tier and second tier of the pension system, including consideration of the causes and contributing factors, financial and social impacts, international best practice and proposals and targets in respect of narrowing the gender pension gap in Ireland.

(2) The Minister shall, not later than 10 months after the passing of the Social Welfare Act 2016, cause a copy of the report under subsection (1) to be laid before each House of the Oireachtas.".".

We touched on this issue earlier. It has come up and it will continue to come up. I understand there is legislation before the Dáil in this regard as well. It is an area of considerable concern. The amendment asks the Minister and the Department to address the gender pension gap, which has widened from 35% to 37%. I have mentioned the first and second tiers of the pension system. Given I am unlikely to press the amendment, it would be worth examining the first, second and third tiers of our pension system in this respect. There is a deeply embedded inequality in the system. Last week, the Minister referred to winners and losers. That is not constructive language but if we use it, women have been systematically the losers in our pension system for a long time. The origins of that inequality lie directly in measures such as the marriage bar, which was explicitly recognised as an unequal measure that forced women to leave the workplace and which the State had to cease due to European pressure. We have asked about legal advice and legal concerns and I would encourage the Minister to look into this. There are concerns that under the EU equal treatment directive, the impact of the marriage bar is still being felt by women in Ireland in a reduced rate pension entitlement. This unequal measure is still having a knock-on effect.

On Second Stage, the Minister referred to extending the cost of extending a homemaker's credit retrospectively. The figures previously quoted by the Department relate to 1994 going back to 1953. It is much more difficult to make the case against going back to 1973. Ireland has been clearly ruled out of order since that year in respect of the marriage bar. There was an onus on the State from 1973 to rectify the inequalities between women and men. This is a significant legacy issue which continues to have an impact on women. It is not an academic exercise. It affects women every week and it affects not only their incomes but their economic independence.

The State has moved backwards in respect of pension inequality for women. Women predominate in the education and health sectors of the public sector, for example, and they have suffered due to a loss in pension and a lack of career progress. This was recognised by the ESRI as having a hugely disproportionate impact on women in terms of their income and long-term pensions. Research by Age Action Ireland and many other organisations demonstrates that only one third of those in receipt of the full contributory State pension are women while women are twice as likely as men to be on the lowest rates of pension. Means testing of the non-contributory pension is an issue for many women. They feel they cannot take a means test because it will affect their partner's means. This again raises the issue of economic independence. Many women, therefore, tend to exist as qualified adults within the system, relying on a supplementary payment paid directly to their spouse. There is provision whereby it can be requested to be paid separately, but in the majority of cases, it is an additional payment to the spouse. There are deep holes in the system, and when putting forward roadmaps for the future, we need to establish trust with the half of the population who have been mistreated and who have witnessed their mothers and grandmothers being mistreated by the system.

A universal supplementary retirement savings scheme or whatever form it may take was being considered for the second tier of the system by the previous Administration. However, we need to examine how other forms of contribution will be recognised, for example, the contribution made in terms of care. Care has a clear cost. As the Government tries to put child care systems in place, the cost has become clear. We are also aware of the cost of home care.Every hour of care given by an individual is an hour and a considerable cost saved to the State. The cost of care is being entirely carried by those who are caring, predominantly women. They carry it during their working life and into retirement. The Minister spoke about women living longer and that upset a couple of older women who spoke to me about it. That is not an adequate response to be giving in respect of the pension age because every week people have to eat and pay for their heating. To live longer on a basic or minimal income is not to accrue some long-term benefit or nest egg. This is the money they survive on and they have a very strong sense of its inadequacy. Moreover, insult is added to injury because people aged over 80 in receipt of the contributory pension get €10 extra, which is positive and right because those who have lived to that age deserve something for their work in establishing our State but qualified adults, predominantly women, do not get that €10 increase when they are in their 80s. The pension and income gap between men and women through the system increases when women are in their 80s.

This is a very serious legacy issue of lack of equal treatment. If we want to credibly move forward with the pension system in Ireland, we need to reform and fix the gaps in the first tier. I am urging the Minister to produce a report on this. The Oireachtas Joint Committee on Social Protection will issue a report on pension policy, most likely to include issues of the gender pension gap. I urge the Minister to take on this proposal and to perhaps indicate that he will be willing to take on some of the committee's recommendations. I specify the first and second tiers because the question of how we recognise other forms of contribution will be complex for the second tier.

The third tier is the private pension industry. While I know this is not within the Minister’s remit, it is crucial because this is what gives the Minister the leverage and funding he needs to deliver the kind of repair work that is required. I have sent a proposal separately to the Minister for Finance asking him to examine the current system of private pension tax relief at the marginal rate which greatly and disproportionately benefits high earners and is a subsidy from those in the bottom third of incomes, the half of the population earning €28,500, very few of whom have any form of private pension but who are paying tax. This money is then given as a subsidy in the form of tax relief to those on the highest incomes who can, in some cases, write off up to €40,000 a year in tax relief through pension schemes which are not delivering a dividend or interest but serve as a holder for money. That is part of the wider issue that was raised about some of the failures we have seen in the private pension schemes, which also get additional tax revenue from the State in that they are exempt from capital gains tax on their property portfolios. This is a private pension tax system which is being deeply subsidised and which has let down its members and those who were relying on it at the cost of funds which I believe should be directed into our first and second-tier system. I am not asking for extra money to come from the sky but I am asking the Minister to engage constructively with the Minister for Finance and to demand the moneys that I believe should be directed through the Department of Social Protection and I will press for that.