Seán Canney (Galway East, Independent)
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469. To ask the Minister for Employment Affairs and Social Protection if she is aware that the contribution history records currently being used by her Department do not show home making and home caring credits; if she agrees that this is putting many parents and carers at a disadvantage in terms of receiving their correct pension entitlement; if she further agrees that this is having a particularly negative effect on the ability of many older women to access a proper pension; the steps she is taking to address this serious deficiency; and if she will make a statement on the matter. [24390/23]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The current State Pension (Contributory) system gives significant recognition to those whose work history includes an extended period outside the paid workforce, often to raise families or to provide another full-time caring role.

Applicants for the State Pension (Contributory) have their entitlement assessed under two separate criteria, receiving a payment based on whichever method is most beneficial to the person. The Yearly Average (YA) method has been in place since the introduction of the contributory pension in 1961. The YA method uses all paid and credited contributions divided by time spent in the social insurance system to give an average of Social Insurance contributions per year with payments made on a banded basis.

Under the Yearly Average method, applicants can apply under the Homemaker's Scheme for those years since 1994 spent caring for children under 12 or other dependent relatives to be disregarded in the calculation. Up to 20 years disregard can be applied. This means the pension average does not disadvantage an applicant for the time spent caring. An application for Homemakers is available on gov.ie - Homemaker’s Scheme (www.gov.ie)

In January 2018, the Total Contributions Approach was introduced which removed the time spent in the Social Insurance system as a factor and simply added paid and credited contributions together. Homecaring periods can be claimed for providing full time care to children under 12 or people aged over 12 who require an increased level of full-time care. Up to 20 years of Homecaring Periods can be claimed. An online application is available onservices.mywelfare.ie/en/topics/pensions-and-older-people/pension-recalculation/

This reform fundamentally changed the entitlement of many who spent time out of the workforce caring for others. For the first time, it acknowledged home caring periods prior to 1994. The Total Contributions Approach arrangement results in a fairer and a more transparent system, as the person’s lifetime contribution is reflected in the State Pension (Contributory) payment received.

This Government continues to acknowledge the important role that carers play and is fully committed to supporting them in that role. Another important reform agreed by Government last year is enhanced State Pension provision for people who have been caring for incapacitated dependents for over 20 years. It will do this by attributing the equivalent of paid contributions to long-term carers to cover gaps in their contribution record.

Department officials are currently working to implement the reforms, including the drafting of legislation and development of administrative and IT systems for implementation by January 2024. This will include identifying the eligibility criteria for those who will be attributed the equivalent of paid contributions for periods of long-term caring along with revising the PRSI contribution statement so that it is in a format that is easily understood for individuals to calculate future pension entitlement.

Where a person reaches State Pension age and does not satisfy the conditions to qualify for a SPC or qualifies for less than the maximum rate, he/she may qualify for the means-tested State Pension (Non-Contributory), the maximum rate of which is over 95% of the rate of the State Pension (Contributory). Alternatively, an Increase for a Qualified Adult (IQA) is paid, generally, where a pensioner has an adult dependent who does not have enough contributions to claim a maximum rate State Pension (Contributory) in his or her own right. The payment rate for the IQA is up to 90% of a full contributory pension. The most advantageous payment for a pensioner will depend upon their individual circumstances.

I hope this clarifies the matter for the Deputy.