John Gormley (Dublin South East, Green Party)
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Question 128: To ask the Minister for Social and Family Affairs if he intends to approach the Department of Finance regarding the anomaly that has arisen with the ability of those in receipt of the State contributory pension to earn additional income, becoming less than those in receipt of the non-contributory pension since the introduction of the €100 a week income disregard. [11039/06]

Séamus Brennan (Dublin South, Fianna Fail)
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Given the ongoing improvements in life expectancy which are occurring and the challenges we face in the future as the proportion of older people in our population grows, it is important that we should encourage and facilitate people who wish to extend their working lives as this can make a significant contribution to the sustainability of our pensions system.

In the budget I introduced, for the first time, a specific earnings disregard for those receiving the old age non-contributory pension of €100 per week. This is in addition to the normal income disregard which applies and which was increased in the budget from €7.60 to €20 per week. This measure is designed to encourage longer working among older people and its effectiveness and adequacy will be kept under review. The equivalent contributory payment, the old age contributory pension, is not means tested and so a person who is eligible for this pension will receive payment regardless of any earnings or other income they may have.

The position on the retirement pension is different. This scheme was introduced in 1971 to provide cover for people who were obliged to retire at age 65, until they reached the normal social welfare pension age, which at that time was 70 years of age. Accordingly, a qualifying condition for the scheme is that a person is not engaged in insurable employment and this, effectively, places an earnings ceiling of €38 per week on any income a person may derive from continuing to work. However, as the standard qualifying age for social welfare pensions is now 66 this restriction only applies for one year. The removal of the retirement condition associated with the retirement pension is a commitment in the programme for Government and progress in this regard will be made as soon as possible.