Terence Flanagan (Dublin North East, Independent)
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178. To ask the Minister for Social Protection her plans to amend the law to allow workers to pay contributions after they reach their 66th birthday so that they can qualify for a full contributory old age pension; the reasons the age of 66 years was decided; and if she will make a statement on the matter. [43180/14]

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 and the reform measures introduced to date go somewhat toward that goal. To ensure that the individual can maximise their entitlement, all contributions paid over their working life from when they first enter insurable employment until pension age are taken into account when assessing whether they are entitled to State pension contributory, and the level of any such entitlement.

Once over 16, the date a person enters into insurance is taken as the date used for averaging purposes in order to qualify for a State pension.

To qualify for a state pension a person must:

- have at least 520 paid contributions and

- satisfy a yearly average test (a yearly average of 48 contributions paid and/or credited is required for a maximum rate pension, reduced rates may be paid at various levels where the yearly average is between 10 and 47).

The Social Welfare Consolidation Act 2005 defines insurable employment as "employment such that a person, over the age of 16 years and under pensionable age, employed in that employment would be an employed contributor".

Once a person reaches pension age he/she is no longer in insurable employment and therefore is not liable to pay PRSI contributions. There are no provisions in legislation which allow a person to pay contributions beyond pension age.

The majority of those aged over 66 would not qualify for a higher rate of State pension contributory if PRSI was levied on their current income. In many cases they are either in receipt of such a pension at the full rate, or they receive a pension which is not based on their PRSI record (e.g. a public service pension, or a State pension non-contributory). In many other cases, the additional contributions would not be sufficient to increase their yearly average above the threshold required for a higher rate of pension.

The introduction of a requirement for such people to pay PRSI on their income after 66 would not, therefore, be welcomed by the majority of pensioners.

In the longer term, by 2020, it is planned to introduce a total contributions approach to pension entitlement, replacing the current yearly average system, and issues such as longer working and incentives to encourage this will be considered as part of that reform.