Sandra McLellan (Cork East, Sinn Fein)
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To ask the Minister for Social Protection if she will guarantee that no cuts will be made to State Pension Contributory and noncontributory to prevent pensioners from the risk of poverty considering that the average pensioner is just above the poverty line with the current provision; and if she will make a statement on the matter. [48687/12]

Joan Burton (Dublin West, Labour)
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The Deputy will be aware that the State pension is a very valuable benefit and that the sustainability of the State pension system is even more essential in our current difficult fiscal climate.

In this context, is important to note the significant long term challenges facing the Irish pension system. There are currently six people of working age for every pensioner and this ratio is expected to decrease to approximately two to one by 2050. People aged 65 years and over will account for a greater proportion of the population while the proportion of working age is expected to decline. People are living longer with healthier lives, and while this is a welcome development, it does have obvious and significant implications in relation to the future costs of State pension provision. Therefore, the task of financing increasing pensions will fall to a diminishing share of the population.

In relation to the current adequacy of pensioner incomes, it should be noted that this group have the lowest consistent poverty rate and are least likely to be at risk of poverty due to the adequacy of the State pension, compared to the rest of the population. Between 2004 and 2010, consistent poverty for those aged over 65 decreased from 3.3% to 0.9%. The at risk of poverty rate for people in that age group fell from 27.1% to 9.6% over the same period.

In relation to budgetary measures, the revised estimates for my Department provide for expenditure in 2012 of nearly €6.26 billion on pensions or 30.4% of total expenditure. The Comprehensive Expenditure Report 2012 – 2014 published by Government last December provides for additional new expenditure reduction measures of €540 million to be achieved in Budget 2013. Reducing overall expenditure in 2013 and beyond in line with these targets will be very challenging.

The Government will consider the appropriate level of expenditure on pensions in 2013 in the context of the forthcoming Budget. The outcome will be announced on Budget Day.