I too express sympathy at the death of my good friend and predecessor, Séamus Brennan. When I was appointed to this role, I sent him a text to the effect that I would look forward to receiving his advice. He immediately texted back offering to meet me but, unfortunately, that was not to be. It is a sad loss for Ann and the family, his constituents and everybody who has been interested in the political life of this country.
I thank the select committee for the invitation to discuss the terms of the draft agreement on social security with the Republic of Korea. Ireland has bilateral agreements on social security with a number of countries. Most of these date from the early 1990s and are with countries which have significant numbers of Irish emigrants, including the USA, Canada, Australia and New Zealand. In these cases the most valuable aspect is the provision for aggregation of periods that are reckonable for pension purposes where a person has been employed in both countries under both jurisdictions but has an inadequate record under one system to qualify for a pension. When a pension is payable on the combined record, the amount of Irish pension payable is calculated in proportion to the period of employment in Ireland vis-à-vis the combined period. An example of this is included at the bottom of the first page of the briefing note which my Department has provided for the select committee.
The negotiation of this agreement with Korea was initiated at the latter's request in the context of our mutual interest in developing trade and facilitating economic investment by businesses in both countries. In addition to ensuring pension cover for workers moving between the two countries, the agreement allows posted workers, such as managers or advisors sent to work in branch offices or subsidiary companies, to remain under the social insurance system of their sending country for up to five years. This agreement on social security will therefore add to Ireland's attractiveness for inward investment from Korea, which is a major player in Asia, especially in information technology. Similarly, it will also protect the continuity of cover for Irish personnel posted temporarily to Korea by Irish employers.
The reciprocal provisions of the agreement are similar to those in our existing agreements with other countries and follow a pattern widely used internationally. The benefits covered are all contributory and comprise State pensions, including transition pensions, widow's and widower's pensions, guardian's payments and bereavement grants. The agreement involves a charge on public funds because Irish benefits arising from its application will be paid out of the social insurance fund, so its terms must be approved by Dáil Éireann in accordance with the provisions of Article 29.5.2° of the Constitution. However, the number of pension claims arising from the agreement is expected to be very small and the cost to the Exchequer is expected to be minimal.
The agreement will become operative on the first day of the third month following the month in which written notification is exchanged by both parties to the effect that all domestic requirements have been fulfilled. This will be done when the terms of the agreement have been approved by both Parliaments and the necessary administrative arrangements, such as translation of forms, are in place. The agreement will then be brought into force by means of ministerial order.
I am accompanied today by the very knowledgeable Ms Anne McManus and Mr. Philip Melville of the EU-intemational unit of my Department. We will be happy to address any questions members may have on the motion.
