Paul Kehoe (Wexford, Fine Gael)
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456. To ask the Minister for Social Protection if he will consider changing the current policy and increasing the pension paid to a person (details supplied) and others who were only awarded a half-rate pension due to the dates when the self-employed contributions were implemented; and if he will make a statement on the matter. [22616/16]

Leo Varadkar (Dublin West, Fine Gael)
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The State pension is a very valuable asset and it is important, for sustainability reasons, that those who receive it have made a significant contribution towards it during a working life. Currently, to qualify for a State pension (contributory), a person must satisfy a number of qualifying conditions which include commencing insurable employment at least 10 years before pension age, having a minimum of 520 qualifying PRSI contributions and achieving a yearly average of at least 10 qualifying contributions, paid or credited, over their working life.

Social insurance contributions (Class S PRSI) were introduced for self-employed people on 6 April 1988. These contributions provide cover for self-employed people for long-term benefits such as State pension (contributory) and widows/widowers pension (contributory). In addition to the qualifying conditions above, a person must have paid self-employment contributions in respect of at least one contribution year prior to reaching age 66, and all self-employment contributions payable must have been paid in full.

The State pension (contributory) half-rate pension for self-employed people was one of a number of measures which was introduced by the Government. The legislation providing for this partial pension came into effect from the 9 April 1999 to provide a basic payment for groups who would not otherwise qualify for a contributory social welfare pension, and who did not satisfy the means test for the State pension (non-contributory). In this case, the measure was designed to benefit self-employed people who were already over 56 years of age when compulsory self-employed social insurance was introduced in 1988, who had not paid other contributions (such as voluntary contributions, or other contributions while in employment), and who could not therefore satisfy the condition of having entered insurance 10 years before pension age. The pension requires a minimum of 5 years contributions and is payable at 50% of the standard rate. The pension was seen as a reasonable response to the position of the self-employed and I believe most would agree that it represents good value for the contributions made.

It is worth noting that the most recently published Actuarial Review of the Social Insurance Fund found that the self-employed achieve very good value for money from the fund.

A person who is unable to meet the qualifying conditions for a State pension (contributory), or who is only eligible for a reduced rate of contributory pension, may alternatively apply for State pension (non-contributory) amounting up to 95% of the maximum contributory pension rate which is subject to a means-test.

I hope this clarifies the matter for the Deputy.