Written answers

Tuesday, 7 November 2017

Department of Employment Affairs and Social Protection

State Pension (Contributory)

Photo of John BradyJohn Brady (Wicklow, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

1194. To ask the Minister for Employment Affairs and Social Protection the work that has been done to date by her Department on the proposed total contributions approach for the State pension; and if she will make a statement on the matter. [45839/17]

Photo of Regina DohertyRegina Doherty (Meath East, Fine Gael)
Link to this: Individually | In context | Oireachtas source

It is my intention to introduce a Total Contributions Approach to the calculation of the State Pension (Contributory) from 2020 onwards and I will be bringing forward proposals in this regard in the near future.

Officials in my Department have been working on the introduction of the scheme since 2015. The recent Actuarial Review of the Social Insurance Fund has been used to explore the costs of various options and to inform the design of the Total Contributions Approach.

This Review was recently completed and published, and the costings produced are being considered, with a view to progressing to the next stage, which will include a consultation process. The final structure of the model, which will include the number of years required for a maximum rate of pension, and the treatment of credited contributions and homemaking periods, will be submitted to government. Subsequent to this, legislative proposals will be introduced to the Oireachtas.

I hope this clarifies the matter for the Deputy.

Photo of John BradyJohn Brady (Wicklow, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

1195. To ask the Minister for Employment Affairs and Social Protection the persons that will benefit from the total contributions approach; if it will apply to all persons that retire post 2020; and if she will make a statement on the matter. [45840/17]

Photo of Regina DohertyRegina Doherty (Meath East, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The introduction of a Total Contributions Approach to the State Pension (contributory) is being examined by officials in my Department. I expect them to report to me shortly before bringing the matter to Government. Particular attention will be paid to people who have intermittent PRSI records as a result of taking time out of paid employment for caring duties.

The Total Contributions Approach will be a fairer way of calculating entitlement to the State Pension (contributory) and will more closely align that entitlement to a person’s contribution to the Social Insurance Fund throughout their working life.

The exact details of the proposal have to be finalised and the beneficiaries from the approach will depend on the structure of the scheme, notably the number of years required for a full pension and the treatment of credited contributions and homemaking periods. The scheme will apply to all new applicants from its introduction. Any potential transitional measures have not been considered at this juncture. I do not wish to pre-empt the outcome of the consultations that are ahead which may have an impact on the final model chosen.

I hope this clarifies the matter for the Deputy.

Comments

No comments

Log in or join to post a public comment.