Terence Flanagan (Dublin North East, Independent)
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213. To ask the Minister for Social Protection if she will address a matter (details supplied) regarding pensions; and if she will make a statement on the matter. [26386/15]

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. 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. 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". 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).

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.

If legislation was to be introduced to exempt those with 40 years of contributions from paying further PRSI, it would reduce the yearly average of those people at retirement, and they might consequently qualify for a lower rate of State pension (contributory), depending on their circumstances. It would also mean, before retirement, that they might lose entitlement to working age payments, such as Jobseekers Benefit and Illness Benefit. It would also reduce the level of PRSI payments made into the Social Insurance Fund, thereby requiring (a) an increase in the Exchequer subvention to the fund, (b) an increase in the rate of PRSI paid during working life, and/or (c) a reduction in the rates of PRSI-funded payments, such as the State pension (contributory).