Fergus O'Dowd (Louth, Fine Gael)
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542. To ask the Minister for Employment Affairs and Social Protection the plans for persons who face mandatory retirement and wish to continue working past their 65th birthday, which will benefit the State through tax take and allow persons in negative financial situations to continue to earn valuable income; and if she will make a statement on the matter. [9536/22]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The Deputy will be aware that there is no statutory compulsory retirement age for employees in Ireland. Responsibility for setting retirement age is a matter for the employer/employee relationship and the contract of employment. The Court of Justice of the European Union (CJEU) has made rulings in a series of age-discrimination cases concerning Directive 2000/78/EC, which prohibit work-related discrimination on various grounds, including age. The CJEU has clarified that mandatory retirement ages may be set down by employers within the context of national law, whether by contract, custom and practice or other means, but that these must be objectively and reasonably justified by a legitimate social policy aim, with the means of achieving that aim being both appropriate and necessary.

Employees have recourse to the Workplace Relations Commission (WRC) in the event of breaches and the WRC has a number of adjudications on such matters. To assist employers and employees in this regard and in respect of retirement ages, the WRC has produced a Code of Practice on Longer Working, and the Irish Human Rights and Equality Commission has published guidance material for employers on the use of fixed-term contracts beyond normal retirement age.

The Deputy will also be aware that we established the Pensions Commission in November 2020 to examine the sustainability of the State Pension system and the Social Insurance Fund, in fulfilment of a Programme for Government commitment. The Commission was an independent body comprised of knowledgeable and experienced academics, pension experts, members of civil society and representatives of workers and employers. Once it completed its work and fulfilled its obligations, the Commission was dissolved. The Commission's Report was published on 7th October 2021. The report, Technical Sub-Committee's working papers and submissions made to the Pensions Commission are available on the website, pensionscommission.gov.ie.

The Commission’s Report is a comprehensive report that takes account of an assessment of various analyses of population, labour force and expenditure projections; an examination of international approaches; and responses to an extensive consultation process. It established that the current State Pension system is not sustainable into the future and that changes are needed. It has set out a wide range of recommendations in this regard - including aligning retirement ages in employment contracts with the State Pension Age, PRSI base broadening measures, and allowing a person to continue paying PRSI contributions past State Pension Age to improve their social insurance record for State Pension (Contributory) purposes.

Successive Governments have committed to supporting older peoples’ continued engagement in economic and social life, including in the National Positive Ageing Strategy (2013), the Report of the Interdepartmental Working Group on Fuller Working Lives (2016) and the Roadmap for Pensions Reform 2018 – 2023 (2018). Building on the work of these previous groups, the Pensions Commission supported measures to facilitate and encourage fuller working lives. The Commission also fully supported Government commitments to facilitate employees remaining at work past the prevalent contractual retirement age of 65 if they wish to.

In the interests both of older people and future generations of older people, this Government intends to consider the comprehensive and far reaching recommendations in the Pensions Commission’s Report very carefully and holistically. The report was referred to the Joint Committee on Social Protection, Community and Rural Development and the Islands. That Committee published its views on the 2nd February 2022. I and my officials will consider these views in our deliberations over the coming weeks.

Separately, as set out in its terms of reference, the Commission on Taxation and Welfare is considering the report of the Pensions Commission in the context of its review of potential changes to the social insurance system, including relevant PRSI rates and coverage recommendations. In addition, my officials are examining each of the recommendations and consulting across Government through the Cabinet Committee system.

I think it is really important that we complete that work and get those views before reaching conclusions on any one recommendation such as the recommendation to align retirement ages in employment contracts with the State Pension Age. I intend bringing a recommended response and implementation plan to Government by the end of March this year.

The State Pension is the bedrock of the pension system in Ireland. It is extremely effective at ensuring that our pensioners do not experience poverty. This Government is committed to ensuring that this remains the case for current pensioners, those nearing State Pension Age and today’s young workers including those who are only starting their careers.

I hope this clarifies the matter for the Deputy.