Darragh O'Brien (Dublin Fingal, Fianna Fail)
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290. To ask the Minister for Social Protection when the review on conditions and criteria for State pension entitlement and eligibility will be completed; and if he will make a statement on the matter. [21722/17]

Leo Varadkar (Dublin West, Fine Gael)
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The National Pensions Framework (2010) proposed that a “Total Contributions Approach” (TCA) should replace the yearly average approach, for new pensioners from 2020. The aim of this approach is to make the rate of contributory pension more closely match contributions made by a person. Officials of my Department are currently working on the detailed development of the TCA with a view to making proposals for consideration later in the year. This is a very significant reform with considerable legal, administrative, and technical elements in its implementation.

Following completion of the Actuarial Review of the Social Insurance Fund later this year, a refined proposal will be developed. My Department will conduct a period of consultation with relevant stakeholders including interest groups, representative bodies and the Oireachtas. Following the consultation period, I will submit a proposal to Government seeking approval of the new approach.

I hope this clarifies the matter for the Deputy.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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291. To ask the Minister for Social Protection the steps he will take to remove the discriminatory eligibility for the State pension which mainly affects women that had a break in employment service; and if he will make a statement on the matter. [21723/17]

Leo Varadkar (Dublin West, Fine Gael)
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Since 1961, when contributory pensions were introduced, the average contributions test has been used in calculating the rate of pension entitlement. Entitlement is banded, with the maximum rate payable to those with a yearly average of 48-52 contributions, and the minimum rate payable to those with a yearly average in the range of 10-14 contributions per year. Even if someone has only 10 years (520 weeks) of paid reckonable contributions between their 16th and 66th birthdays, they would generally qualify for a State pension (contributory), although the rate payable would vary depending on their circumstances, and it will not always be their most advantageous payment to claim, particularly if they qualify for a full-rate State pension (non-contributory).

The homemaker’s scheme was introduced in 1994 to make qualification for State pension contributory (SPC) easier for those who take time out of the workforce for caring duties. The scheme allows up to 20 years spent caring for children under 12 years of age, or incapacitated people, to be disregarded when a person’s social insurance record is being calculated for pension purposes. The effect of this is to reduce the number of years by which the person’s contributions are divided, thereby increasing their yearly average, making it easier for them to qualify for a maximum rate SPC. It does not involve the award of credits.

From September 2012, new rate bands for State Pension contributory were introduced. These additional payment rate bands more accurately reflect the social insurance history of a person and ensure that those who contributed to the Social Insurance Fund more frequently during their working life will, generally, benefit more in retirement than those who made less frequent contributions. People who qualify for a lower contributory pension as a result, but who have an income need, may still claim the means-tested State pension (non-contributory), the maximum rate of which is 95% that of the State pension contributory.

The National Pensions Framework (2010) proposed that a “Total Contributions Approach” (TCA) should replace the yearly average approach for new pensioners from 2020. The aim of this approach is to make the rate of contributory pension more closely match contributions made by a person. Officials of my Department are currently working on the detailed development of the TCA with a view to making proposals for consideration later in the year. This is a very significant reform with considerable legal, administrative, and technical elements in its implementation. An important element in the final design of the scheme will be the position of people who have gaps in their contribution records for various reasons, and this factor is being considered very carefully in developing this reform.

I hope this clarifies the matter for the Deputy.