Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

238. To ask the Minister for Employment Affairs and Social Protection the progress to date in the delivery of the State pension (contributory) to persons who are disqualified due to the calculation methodology; and if she will make a statement on the matter. [39110/18]

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

A policy to introduce the Total Contributions Approach (TCA) to pensions calculation was adopted by Government in the National Pensions Framework in 2010, as was the decision to base the entitlements of all new pensioners on this approach from around 2020. In advance of this, on the 23rd January, the Government agreed to a proposal that will allow pensioners affected by the 2012 changes in rate bands to have their pension entitlement calculated by a new “Total Contributions Approach” (TCA) which will include up to 20 years of a new HomeCaring credit. 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. The TCA will ensure that the totality of a person’s social insurance contributions - as opposed to the timing of them - determines their final pension outcome.

Officials in my Department have been working on the various elements of this reform, which include legislative change, operational changes and IT development. 

My Department will be writing to impacted customers in the next two months to explain to them what is happening and how the process of review will work.  As I have stated previously, it is still planned to commence these reviews before the end of this year, with the first payments being made in the first quarter of 2019, backdated, where relevant, to the end of March 2018, or later where a person attained their 66th birthday since that date.

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 then write again to the people impacted and provide them with the opportunity to have their pension calculation reviewed.

I should stress to the Deputy that this reform assists people, by helping them to qualify for a pension at a higher rate of payment, if they have the required contributions and/or homecaring periods.  The 2012 rateband changes did not disqualify anyone from qualifying for a pension.  As with the Yearly Average approach and the pre-existing homemakers disregard scheme, these new measures only determine the rate of payment for those with an entitlement to a State pension (contributory). They do not remove the requirement to be entitled to such a pension in the first place, based on criteria set out in legislation.

For those who do not qualify for the State Pension (contributory) (SPC), but who are above State pension age, there are other state pension payments available. Notably, they may qualify for the State Pension (non-contributory) which is a means-tested payment (based on their share of household means) with a maximum payment of 95% of the SPC. If their spouse has a contributory pension, they may qualify for an increase for a qualified adult (based on their own means), amounting up to 90% of a full rate SPC pension.

I hope this clarifies the matter for the Deputy.