Catherine Murphy (Kildare North, Social Democrats)
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1263. To ask the Minister for Employment Affairs and Social Protection if her attention has been drawn to a letter sent to her and copied to some members of the Houses of the Oireachtas; if a reply will issue to the person (details supplied); and if she will make a statement on the matter. [46861/17]

Regina Doherty (Meath East, Fine Gael)
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I can confirm that it is policy that all such letters to me are answered where there is a return address.

“Developing the National Pension 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 contributions. The necessary legislation to effect the recommendations of the National Pensions Board was contained in Section 12 of the Social Welfare Act 1997 (now incorporated in the Social Welfare Consolidation Act 2005) which provided for the implementation of the change in two stages, with the paid contribution requirement being standardised at 260 from 2002, rising to 520 from April 2012. This condition applies for all new claims to the State pension (contributory).

The Yearly Averaging method of calculating the level of entitlement has been used since the introduction of the State Pension (contributory) in 1961. The homemaker's scheme makes qualification for a higher rate of State pension contributory easier for those who take time out of the workforce for caring duties. The scheme, which was introduced in and took effect for periods from 1994, allows up to 20 years spent caring for children under 12 years of age, or caring for incapacitated people over that age, to be disregarded when a person’s social insurance record is being averaged for pension purposes, subject to the standard qualifying conditions for State pension contributory also being satisfied. This has the effect of increasing the yearly average of the pensioner, which is used to set the rate of his or her pension.

It should be noted that the increase in paid contributions required, from 260 to 520, does not impact upon the yearly average calculation, which is still calculated in the normal way. It should also be noted that backdating the Homemakers scheme, which was introduced in 1994 and took effect from that date, would not assist someone with insufficient paid contributions to qualify for a contributory pension, as it involves the disregard of years, rather than the creation of paid contributions.

Where someone does not qualify for a full rate contributory pension, they may qualify for an alternative payment. If their spouse has a contributory pension, they may qualify for an increase for a qualified adult, amounting up to 90% of a full rate pension. Alternatively, they may qualify for a means-tested State pension non-contributory, which amounts up to 95% of the maximum contributory rate.

It is planned that a total contributions approach will replace the yearly average approach from around 2020. The position of homemakers will be carefully considered in the context of that reform.

I hope this clarifies the matter for the Deputy.