Joanna Tuffy (Dublin Mid West, Labour)
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To ask the Minister for Social Protection if she will provide up to date costings regarding backdating the home-makers scheme to 1964; and if she will make a statement on the matter. [51676/12]

Joan Burton (Dublin West, Labour)
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The State pension is a very valuable benefit and is the bedrock of the Irish pension system. Therefore, it is important to ensure that those qualifying have made a sustained contribution to the Social Insurance Fund over their working lives.

The homemaker's scheme makes qualification for the State pension (contributory) easier by disregarding time spent out of the workforce for caring duties. The scheme was introduced in and took effect from 1994. Eligibility for the homemaker's scheme is conditional on firstly meeting the standard qualifying conditions for State pension.

Backdating the scheme to 1964 would involve considerable costs. The most recent analysis of this was published in the 2007 Green Paper on Pensions. This identified that the cost of backdating the homemaker's scheme to 1953, the year when the unified system of social insurance was introduced in Ireland, would be in the region of €160m and to 1973/73, an estimated €150m.

Updating these estimates would involve considerable effort which would not be warranted at this time. However, it is clear that the costs, under the current rules, can be expected to increase in the coming years due to the increase in female employment rates since 1994.

The recently published review of the Social Insurance Fund identified that in the medium to long term, pension related expenditure will account for an increasing proportion of the Social Insurance Fund expenditure - rising from 57% in 2011 to 85% in 2066.

The pensioner support ratio is projected to decline from 5.3 workers for every individual over pension age in 2010 to 3.9 workers by 2020 and to 2.1 workers by 2060.

In terms of value for money for those who take time out of the workforce, the report confirms that social insurance benefits offer excellent value for money for those:

- on the lower part of the income distribution,

- those with shorter contribution histories, mostly women

- and the self-employed.

Notwithstanding the changes in the contribution rules and associated rates of payment which were introduced in September 2012, those with lower earnings and those with shorter contribution histories, will continue to obtain the best value for money from the Fund. This can be of particular benefit to women.

A State pension non-contributory pension, which is a means tested payment, may also be payable. Time taken out of the workforce for home-making and caring duties will continue to be protected by the current disregard. While my Department will keep the homemaker's scheme under review, any improvements which could result in further costs for the Exchequer could only be considered in a budgetary context. The Government’s priority is to secure economic recovery, promote growth and employment. To this end, the State must pursue a determined deficit reduction strategy. Accordingly, there will be an on-going requirement to curtail expenditure in 2013 and in later years.

The Government is considering the appropriate level of expenditure on the wide variety of schemes and services operated by my Department in 2013 in the context of the forthcoming Budget. The outcome will be announced on Budget Day.