Written answers

Tuesday, 10 June 2014

Department of Social Protection

Pension Provisions

Photo of Arthur SpringArthur Spring (Kerry North-West Limerick, Labour)
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295. To ask the Minister for Social Protection if a person (details supplied) in County Kerry was entitled to a tax free lump sum when finishing work. [24360/14]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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The person concerned was redeployed to my Department in January 2012 together with approximately 700 FÁS staff. As part of the terms of the redeployment, all former FÁS staff retained the terms and conditions of employment that applied prior to their transfer to this Department. The records my Department received from FÁS in respect of the person concerned show that they were employed as a temporary part time cleaner in Tralee working 12.5 hours per week. They were employed in a non-pensionable capacity and as such would have no entitlements to a pension and lump sum. As the nature of their employment was non-pensionable and temporary, they were allowed to continue working beyond the normal maximum retirement age of 65, which they reached on 13 September 2001. The Human Resources Division of my Department have been in touch with FÁS to ascertain if there would have been any provision within their schemes to pay the person concerned a special gratuity if they were to resign. Unfortunately, they have advised us that no such provision exists. As such, I regret to inform you that the person concerned would not qualify for a special payment or a tax free lump sum.

Photo of Alan FarrellAlan Farrell (Dublin North, Fine Gael)
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296. To ask the Minister for Social Protection the amount it would cost the Exchequer to increase the contributory and non-contributory pensions by 10%; and if she will make a statement on the matter. [24454/14]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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The cost of increasing all contributory and non-contributory pensions (with proportionate increases for qualified adults) by 10% per week for those aged 66 and over is estimated at €613 million in 2015.

Photo of Joan CollinsJoan Collins (Dublin South Central, United Left)
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299. To ask the Minister for Social Protection her plans to protect and improve the living standards of pensioners. [24277/14]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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The biggest single block of expenditure in the Department is expenditure on pensionswhich will amount to €6.5 billion or 33% of overall expenditure this year. It is expected that demographic change will see this grow, e.g., approximately 17,000 additional pensioners are in receipt of State pension each year, and in 2013 the Department had to make provision for an additional €190 million for the increasing number of pensioners. The overall concern of the Government in recent budgets has been to protect the primary weekly social welfare rates. Maintaining the rate of the State pension and other core payments is critical in protecting people from poverty.

Whilst an objective of the pension system in Ireland is to provide an adequate and sustainable basic standard of living through direct State supports, it is also to encourage people (through tax reliefs) to make supplementary pension provision so that they may have an adequate replacement income when they retire from work. The State pension has been successful in ensuring older people have an adequate income. However, many people retiring from work will have a significant income gap if they do not have supplementary pension provision. Recent figures indicate that only half of workers aged between 20 and 69 years have a supplementary pension and this relatively low coverage is of concern. Accordingly, it is a priority for the Government to increase supplementary pension coverage and the Programme for Government includes a commitment to reforming the pension system to progressively achieve universal coverage, with particular focus on lower-paid workers.

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