Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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71. To ask the Minister for Employment Affairs and Social Protection if it is the case that currently, to receive the full State pension (contributory), a person requires 980 A1 stamps, equivalent to 20 years full-time work, but that as of 2034 (that is, those born after 1 January 1968), the requirement will increase to 2,100 A1 stamps, equivalent to 45 years full-time work; the rationale for such a change; if this change will affect all workers/pensioners, regardless of their income while working, or will affect people differently depending on their incomes while working; and if she will make a statement on the matter. [26392/24]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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Once a person has met the minimum requirement of 520 paid contributions, the rate of payment at which a person is paid the State Pension (Contributory) is currently calculated using two methods; the Yearly Average (YA) method that has been in place since the introduction of the contributory pension in 1961 and the Total Contributions Approach (TCA) that was introduced in 2018. The most beneficial payment is then awarded to the person.

To qualify for a full rate pension under the YA method, a person must have an average of 48 contributions per year since they first entered insurable employment.

To qualify for a full rate pension under the TCA method, a person must have 2080 contributions (equivalent to 40 years). These contributions can include up to 20 years HomeCaring periods or PRSI credits.

Following on from the Pensions Commission's recommendations, a number of State pension reforms were enacted in the Social Welfare (Miscellaneous Provisions) Act 2023 on the 14th December 2023, which represent the biggest ever structural reform of the Irish State pension system.

One of the reforms in the 2023 Act was the ten-year phased transition from the YA method of calculation of State Pension (Contributory) to TCA as the sole method of calculation.

TCA resolves many of the anomalies arising from the YA calculation model. The main anomaly within the YA calculation method is that it is possible for people to start paying social insurance later in their working life and yet qualify for a pension at maximum rate. Entitlement to a full pension can in some cases be achieved from as little as ten years of social insurance contributions. Another anomaly arises where a person has a gap in their social insurance contribution record, possibly from periods spent caring for family or travel, and qualifies for a lower pension entitlement than a person with the same number of social insurance contributions. This occurs as their Yearly Average is calculated over the person’s entire ‘working life’.

TCA is a fairer and more transparent method of calculating the contributory pension as it more closely reflects the social insurance contributions made by a person during their working life.

The ten-year transitional arrangements are to avoid a ‘cliff edge’ effect. The first year of phasing-out will begin in January 2025. From 2034 the YA method of calculation will no longer be used, and all State Pension (Contributory) calculations will use the TCA method.

Finally, the rate of payment of State Pension (Contributory) is based on a person's contribution record, including paid and credited contributions, and is not based on levels of income in employment or self-employment.

I trust this clarifies the matter for the Deputy.

Cathal Crowe (Clare, Fianna Fail)
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72. To ask the Minister for Employment Affairs and Social Protection if she will consider changing the rules to allow stamps paid before marriage be taken into account for the State pension (contributory) (details supplied); and if she will make a statement on the matter. [26397/24]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The marriage bar was a legal requirement for women in the Irish civil service and some areas of the public service to retire from employment after marriage. While the legislation applied only to the civil and public sector, a similar policy was adopted by other sectors, such as the banking sector. The marriage bar for civil servants was removed from legislation in 1973.

Civil and public servants, including those who worked in our public health service, recruited prior to April 1995 are not entitled to the State Pension (Contributory) and would not have been entitled to it had they continued working as a civil or public servant, regardless of gender and marital status, due to the application of a modified PRSI rate returned as Class B or Class D.

There are no plans to allow social insurance contributions paid at the modified Class B or D rates be reckonable for the State Pension (Contributory).

Provisions exist for the award of a mixed insurance pro rata state pension, where a person has substantial periods of PRSI coverage that are not reckonable for State Pension (Contributory) purposes (ie. modified contributions). In order to qualify for a pro rata pension, a person must have a minimum of 260 full-rate paid contributions since their entry into insurance.

Matters relating to the pension entitlements for civil and public servants recruited prior to April 1995 are a matter for my colleague the Minister for Public Expenditure, NDP Delivery and Reform.

I hope this clarifies the matter for the Deputy.