Written answers
Wednesday, 15 November 2023
Department of Employment Affairs and Social Protection
Pension Provisions
Seán Canney (Galway East, Independent)
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105. To ask the Minister for Employment Affairs and Social Protection if she will consider allowing people on partial pensions the benefit of a full budget increase, as opposed to a pro-rata increase in pension income, as many people dependant on a partial contributory pension are failing to take advantage of the full benefit of budget increases, despite having to meet the full cost of rising cost of living prices; and if she will make a statement on the matter. [50152/23]
Heather Humphreys (Cavan-Monaghan, Fine Gael)
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As announced in Budget 2024, the maximum rate for the State Pension (contributory) is set to rise by €12 to the new rate of €277.30 per week in January 2024. This was part of a range of targeted measures included in the budget to help older people with the cost of living. These include a Christmas bonus payment, a further bonus payment in January, a €200 lump sum payment for those in receipt of the Living Alone Increase and a €300 lump sum payment for those in receipt of the Fuel Allowance.
The State Pension (contributory) is a contributory pension based on the social insurance record of each recipient. Those who have 40 years worth of contributions, paid or credited, or have an average of 48 contributions for each year since they entered the social insurance system, receive the maximum rate payment. Those who do not qualify for the maximum rate payment receive a payment more closely aligned to their contributions.
When the maximum rate is increased, those below the maximum rate receive the same proportionate increase. If pension recipients in receipt of a pension below maximum rate were to receive an increase of €12 per week, they would receive a greater proportionate increase than those at the maximum rate, who have contributed more to the social insurance fund from which the pension is paid.
The State Pension (non-contributory) is available for all residents over 66 years and may be paid at a rate equivalent to 95% of the State Pension (contributory). While the payment is means tested, significant disregards are available.
I hope this clarifies the matter for the Deputy.
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