Dáil Éireann debate -
Wednesday, 28 Apr 1993

Vol. 429 No. 7

Written Answers. - Pension Adjustments.

Jim O'Keeffe

Question:

61 Mr. J. O'Keeffe asked the Minister for Social Welfare the reason no arrangements have been made to adjust pensions and compensate those in receipt of both UK and Irish pensions for losses arising since the beginning of the devaluation crisis in September, 1992, leading to the consequent decrease in the value of British pensions including the pensions of persons (details supplied) in County Cork; and whether appropriate arrangements will be made, without further delay, to both compensate for those losses to date and to adjust the position for the future.

Minister for Social Welfare (Dr. Woods)

In calculating means for Irish non-contributory pension purposes, British pensioners' Sterling income is converted to Irish Pounds. In order to reflect a reasonable pattern of exchange rates, an average exchange rate system is used for converting all European Community social security pensions to Irish Pounds. For this purpose, the Department uses figures which are provided by the Administrative Commission of the European Communities on Social Security of Migrant Workers.

The Administrative Commission figure is the average of the daily exchange rates in the first month of the previous quarter. This rate is then applied by the Department to all new pension claims made throughout the succeeding quarter. This has been the method used by the Department for many years for converting pensioners' Sterling income to Irish Pounds, including during recent months when wider than usual exchange rate fluctuations have occurred. The average exchange rate basis used avoids the need for frequent reviews of existing entitlements. It also gives an important degree of security to persons who qualify for a Non-Contributory Pension from the Department by protecting them to a large extent from short term movements in exchange rates. The impact of the 1992 exchange rate fluctuations was reflected in the latest EC-supplied average exchange rates now applicable to new claims and to claim reviews. The recent devaluation of the Irish Pound together with further movements in the exchange rate have considerably restored the income position of existing non-contributory pensioners.

It is open to pensioners to apply for a means review at any time where they have reason to believe that their assessments should be changed. Any means review would, of course, include a reassessment of the person's total means. Persons who have already applied to the Department for a review of their means as a result of exchange fluctuations will have any warranted adjustment in their pension rates made. The reviews will have to include any increases in their British pension since the last means assessment was made.

In tabling this question, the Deputy makes specific reference to a couple both of whom are in receipt of reduced rate old age non-contributory pensions. The persons concerned were assessed with means of £56.38 per week in January 1992. Their means were derived solely from a combination of four pensions payable in Sterling. Their entitlements are being reviewed at their request.

Arrangements have been made to notify the persons concerned of the revised assessments and new rates of entitlement to pension. Revised payment books will be issued to them as soon as possible.