Written answers

Friday, 7 September 2018

Department of Employment Affairs and Social Protection

State Pensions

Photo of Robert TroyRobert Troy (Longford-Westmeath, Fianna Fail)
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1250. To ask the Minister for Employment Affairs and Social Protection the status of plans to alter the State pension qualification criteria to ensure that all persons who have had periods outside of the PAYE system or have been homemakers for a period are entitled to a full State pension. [36252/18]

Photo of Regina DohertyRegina Doherty (Meath East, Fine Gael)
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As a general policy, the Government intends to introduce a Total Contributions Approach (TCA) to establishing level of entitlement for all new state pension contributory claims from 2020 onwards. I launched a public consultation on this proposal earlier this year in May. This closed last Monday, the 3rd of September. My Department has now started studying the submissions. Following examination and consideration of the submissions to the consultation, my officials will prepare proposals for the design of the new approach for consideration by the Government in due course.

Separately, I announced on 23rd January an interim TCA for those affected by the 2012 rate-band changes. Under this approach, a person who reached pension age after 1 September 2012 (i.e., who is among those affected by the new ratebands introduced from that date) and who has a 40 year record of paid and credited social insurance contributions, subject to a maximum of 20 years of credits, will qualify for a maximum contributory pension where they satisfy the other qualifying conditions for the scheme.

Up to 20 years of HomeCaring credits, and/or 10 years of other qualifying credits (e.g., when unemployed or ill) may be used, subject to the total number of credits not exceeding 20 years. This approach is expected to significantly benefit many people, particularly women, whose work history includes an extended period of time outside the paid workplace, while raising families or in a caring role. It will make it easier for pensioners assessed under the yearly average model, to qualify for a higher rate of the State Pension (contributory). This interim TCA will ensure that the totality of a person’s social insurance contributions - as opposed to the timing of them - determines a final pension outcome.

Legislation has to be drafted and enacted to enable implementation of these arrangements, and a number of options regarding the best approach to passing that legislation are being considered. In addition, an information technology system has to be developed in line with the legislation. My Department is currently working on both of these. As I've said previously, it is still planned to commence the reviews before the end of this year, with the first payments being made in the first quarter of 2019. In this regard, the commitment we made in January for the payments to be backdated to the end of last March still stands.

It is not necessary for people to contact the Department on this matter. Once the legislation is enacted and the systems and processes are ready, my Department will write to the people impacted and provide them with the opportunity to have their pension calculation reviewed.

I hope this clarifies matters for the Deputy.

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