Written answers

Tuesday, 10 May 2011

Department of Social Protection

Pension Provisions

9:00 pm

Photo of Sandra McLellanSandra McLellan (Cork East, Sinn Fein)
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Question 69: To ask the Minister for Social Protection her views that forcing older persons to remain in the workforce longer by raising the age for the State pension will reduce the number of job opportunities for the very high number of persons of current working age who are unemployed. [10443/11]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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The challenges facing the Irish pension system are significant. In particular, the task of financing increasing pension spending will fall to a diminishing share of the population. There are currently six workers for every pensioner and this ratio is expected to decrease to less than two to one by 2050. Increasing State pension age is one of the ways in which we can sustain the pensions system and also maintain the value of the State pension at 35% of average earnings. As announced as part of the National Pensions Framework, state pension age will be increased gradually to 68 years. This will begin in 2014 with the standardisation of the state pension age at 66. State pension age will be increased to 67 years in 2021 and to 68 in 2028.

Recent research on intergenerational solidarity by the OECD demonstrates that the rate of employment of younger people has no relationship with the rate of employment of older people. Describing what is termed the 'lump-of-labour fallacy' the OECD state that 'the idea that public policy can re-shuffle a fixed number of jobs between workers of different ages is simply not true in anything but the very short-term'. The Department of Social Protection operates a range of employment support measures designed to encourage and support social welfare recipients of working age to reduce their dependency on welfare payments. While the primary responsibility for job creation rests with the Department of Enterprise Trade and Innovation, this Department already has a role in supporting people from welfare to work. The National Employment Action Plan process is a key element in addressing the progression needs of those on the Live Register. It provides a stimulus to job search and affords an opportunity to explore, under professional guidance, the full range of employment and training services offered by FÁS.

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