John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Question 425: To ask the Minister for Social and Family Affairs if an urgent appeal will be arranged in the case of a person (details supplied) in County Kilkenny regarding their State contributory pension and her decision to cease payment; if a reasonable expectation of continued payment of this pension was created following acceptance by her Department of payment of PRSI contributions and thereafter the payment of arrears by her Department to the person and a weekly pension; and if she will re-consider the reason for refusal and determine a solution to the issue in order to allow the pension. [3086/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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Spouses who are actively engaged in a commercial partnership, including the operation of a farm, as opposed to simply being the joint owners of a property, are treated as individual self-employed contributors. In these cases, both spouses are liable to pay PRSI (Class S) contributions in a timely manner.

On foot of a Programme for Government commitment an information leaflet, 'Working with your spouse: how it affects your social welfare contributions and entitlements', has been developed between the Department of Social and Family Affairs and the Revenue Commissioners to set out the social welfare and tax implications of families co-working in a shared business. It was published on the 25 June 2008. The leaflet clarifies that spouses who operate in a commercial partnership may be brought into the social insurance system, subject to certain criteria. In this way, both spouses incur a liability to pay self-employed PRSI and build up entitlement towards a contributory state pension and other social welfare benefits. It is open to person to apply for recognition of a commercial partnership, at any time.

The qualifying conditions for State Pension (Contributory) require the applicant to:

- have entered insurable employment before attaining the age of 56 years

- have at least 260 paid contribution weeks since entry into insurance

- satisfy the yearly average condition.

In addition, section 110 (1) of the Social Welfare (Consolidation) Act 2005 provides that a self-employed contributor shall not be regarded as satisfying the qualifying conditions unless:

(a) the person has paid self-employment contributions in respect of at least one contribution year before attaining pensionable age,

and

(b) all self-employment contributions payable by him or her have been paid.

Section 110 (1)(a) of the Social Welfare Consolidation Act 2005, has been on the statute books for over fifteen years and there has not been a change in policy in relation to the requirement to have paid at least one year's self employment contributions prior to reaching age 66, in order to qualify for a State Pension (Contributory).

The person concerned was awarded a State Pension (Contributory) from 5th November 2004. However, following a review it was found that the self-employment contributions were all paid by the person concerned after their 66th birthday. The person concerned does not therefore satisfy the condition at (a) above and has no entitlement to a State Pension (Contributory) and should not have been put into payment under the scheme. The person has been notified of this decision on 12 January 2010 and has been advised in relation to their right to appeal this decision, or to have it reviewed.

It should be noted that while the publication of the leaflet 'Working with your spouse: how it affects your social welfare contributions and entitlements' clarified existing procedures in relation to the recognition of commercial partnerships between husbands and wives for social insurance purposes, including retrospective payment of social insurance, it did not involve a change in existing policy or administration. In particular, the clarification of the position did not alter people's potential entitlements and all applicants for the state pension (contributory) must continue to satisfy the eligibility conditions as contained in legislation, and outlined above.

The Department understands and apologises for the upset and distress caused to this person and regrets the administrative error involved.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Question 427: To ask the Minister for Social and Family Affairs the reason payment of a State contributory pension have ceased in the case of a person (details supplied) in County Kilkenny; if payment will be resumed in view of the fact that all PRSI contributions have been paid to date and that an outstanding amount requested by her Department has also been paid; and if she will bring about a resolution to the issue and the reason for refusal so that full pension payments will resume. [3088/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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Spouses who are actively engaged in a commercial partnership, including the operation of a farm, as opposed to simply being the joint owners of a property, are treated as individual self-employed contributors. In these cases both spouses are liable to pay PRSI (Class S) contributions in a timely manner.

On foot of a Programme for Government commitment an information leaflet, 'Working with your spouse: how it affects your social welfare contributions and entitlements', has been developed between the Department of Social and Family Affairs and the Revenue Commissioners to set out the social welfare and tax implications of families co-working in a shared business. It was published on 25 June 2008. The leaflet clarifies that spouses who operate in a commercial partnership may be brought into the social insurance system, subject to certain criteria. In this way, both spouses incur a liability to pay self-employed PRSI and build up entitlement towards a contributory state pension and other social welfare benefits. It is open to a person to apply for recognition of a commercial partnership, at any time.

The qualifying conditions for State Pension (Contributory) require the applicant to:

- have entered insurable employment before attaining the age of 56 years

- have at least 260 paid contribution weeks since entry into insurance

- satisfy the yearly average condition.

In addition, section 110 (1) of the Social Welfare (Consolidation) Act 2005 provides that a self-employed contributor shall not be regarded as satisfying the qualifying conditions unless:

(a) the person has paid self-employment contributions in respect of at least one

contribution year before attaining pensionable age,

and

(b) all self-employment contributions payable by him or her have been paid. The person concerned was awarded a State Pension (Contributory) from 20 July 2008. However, following a review it was found that the self-employment contributions were all paid by the person concerned after their 66th birthday. The person concerned does not therefore satisfy the condition at (a) above and has no entitlement to a State Pension (Contributory), and should not have been put into payment under this scheme.The person has been notified of this decision on the 12th January 2010 and has been notified of their right to appeal this decision, or to have it reviewed.

Section 110 (1)(a) of the Social Welfare Consolidation Act 2005, has been on the statute books for over fifteen years and there has not been a change in policy in relation to the requirement to have paid at least one year's self employment contributions prior to reaching age 66, in order to qualify for a State Pension (Contributory).

An overpayment will be determined in the above case and the person concerned will be notified and requested to repay the amount involved. However a Recovery Officer may reduce or cancel an overpayment based on the circumstances of an individual case, in line with governing legislation.

It should be noted that while the publication of the leaflet 'Working with your spouse: how it affects your social welfare contributions and entitlements' clarified existing procedures in relation to the recognition of commercial partnerships between husbands and wives for social insurance purposes, including retrospective payment of social insurance, it did not involve a change in existing policy or administration. In particular, the clarification of the position did not alter people's potential entitlements and all applicants for the state pension (contributory) must continue to satisfy the eligibility conditions as contained in legislation, and outlined above.

The Department understands and apologises for the upset and distress caused to this person and regrets the administrative error involved.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Question 428: To ask the Minister for Social and Family Affairs the reason her Department have ceased payment of a State contributory pension in respect of a person (details supplied) in County Kilkenny having sanctioned the payment of the pension after a detailed investigation and approving a weekly pension and arrears; if the pension will be restored based on her Departments acceptance of payment from the applicant of PRSI contributions; if her Department is now obliged to continue payments having accepted on investigation the clients right to the pension and thereafter entering into the agreement; and if an agreed solution to this issue can be found. [3089/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
Link to this: Individually | In context

Spouses who are actively engaged in a commercial partnership, including the operation of a farm, as opposed to simply being the joint owners of a property, are treated as individual self-employed contributors. In these cases, both spouses are liable to pay PRSI (Class S) contributions in a timely manner.

On foot of a Programme for Government commitment an information leaflet, 'Working with your spouse: how it affects your social welfare contributions and entitlements', has been developed between the Department of Social and Family Affairs and the Revenue Commissioners to set out the social welfare and tax implications of families co-working in a shared business. It was published on 25 June 2008. The leaflet clarifies that spouses who operate in a commercial partnership may be brought into the social insurance system, subject to certain criteria. In this way, both spouses incur a liability to pay self-employed PRSI and build up entitlement towards a contributory state pension and other social welfare benefits. It is open to a person to apply for recognition of a commercial partnership, at any time.

The qualifying conditions for State Pension (Contributory) require the applicant to:

- have entered insurable employment before attaining the age of 56 years

- have at least 260 paid contribution weeks since entry into insurance

- satisfy the yearly average condition.

In addition, section 110 (1) of the Social Welfare (Consolidation) Act 2005 provides that a self-employed contributor shall not be regarded as satisfying the qualifying conditions unless:

(a) the person has paid self-employment contributions in respect of at least one contribution year before attaining pensionable age,

and

(b) all self-employment contributions payable by him or her have been paid.

Section 110 (1)(a) of the Social Welfare Consolidation Act 2005, has been on the statute books for over fifteen years and there has not been a change in policy in relation to the requirement to have paid at least one year's self employment contributions prior to reaching age 66, in order to qualify for a State Pension (Contributory).

The person concerned was awarded a State Pension (Contributory) from 18 August 2006. However, following a review it was found that, the self-employment contributions were all paid by the person concerned after their 66th birthday. The person concerned does not therefore satisfy the condition at (a) above and has no entitlement to a State Pension (Contributory), and should not have been put into payment under the scheme. The person has been notified of this decision on 12 January 2010 and has been advised in relation to their right to appeal this decision, or to have it reviewed. Section 310 (1) (a) of the Social Welfare Consolidation Act 2005 provided that a Deciding Officer may at any time revise the decision of a Deciding Officer for a number of reasons including the correction of a mistake made in relation to the law or the facts.

An overpayment will be determined in the above case and the person concerned will be notified and requested to repay the amount involved. However a Recovery Officer may reduce or cancel an overpayment based on the circumstances of an individual case, in line with the governing legislation.

It should be noted that while the publication of the leaflet 'Working with your spouse: how it affects your social welfare contributions and entitlements' clarified existing procedures in relation to the recognition of commercial partnerships between husbands and wives for social insurance purposes, including retrospective payment of social insurance, it did not involve a change in existing policy or administration. In particular, the clarification of the position did not alter people's potential entitlements and all applicants for the state pension (contributory) must continue to satisfy the eligibility conditions as contained in legislation, and outlined above.

The Department understands and apologises for the upset and distress caused to this person and regrets the administrative error involved.