John Brady (Wicklow, Sinn Fein)
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158. To ask the Minister for Social Protection the estimated cost of reducing the necessary PRSI contributions to qualify for a State contributory pension from 520 to 260. [23652/17]

Leo Varadkar (Dublin West, Fine Gael)
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A number of reforms have been made over the years to the State pension (contributory) scheme to provide for sustainable pensions in the future.

“Developing the National Pensions System – Final Report of the National Pensions Board” published in 1993, recommended that the number of paid contributions required to qualify for a contributory pension should be increased to 520, i.e., 10 years contributions. The necessary legislation to effect these recommendations was contained in Section 12 of the Social Welfare Act 1997 which standardised the paid contribution requirement at 260 from 2002, rising to 520 from April 2012.

In most cases, where older people do not have very high means, those who have less than 520 paid contributions will qualify for an alternative payment instead, such as an Increase for a Qualified Adult (IQA) on their spouses pension, which is paid at up to 90% of the State pension (contributory), or they may qualify for a State pension (non-contributory), which is paid at up to 95% the maximum rate of the State pension (contributory).

At the time this measure was introduced, the annual exchequer net savings were expected to be in the region of €6m per annum but rising substantially on a cumulative basis in the long term. Therefore, the true figure now would be significantly higher.

However, as people with between 260 and 519 paid contributions no longer make claims to State pension (contributory), the data is not available to update this costing.

I hope this clarifies the matter for the Deputy.