Dáil Éireann Debate, Tuesday - 9 October 2007
348 Deputy Michael McGrath asked the Minister for Social and Family Affairs the reason the pre-retirement credits scheme was discontinued in July 2007; if his Department advertised the discontinuation of the scheme; and if he will consider an application under the scheme from a person (details supplied) in County Cork who resigned their employment position during the summer 2007 in anticipation of benefiting from the scheme. [22774/07]
View answerThe Pre-Retirement Credits Scheme (PRECS) enables credits to be awarded to persons who are aged 55 years or older, who are retired from the workforce and no longer looking for work and who, in the immediately preceding period, were in receipt of either Jobseeker's Benefit/Allowance or credits in respect of 390 days of continuous unemployment. Pre-retirement credits can only be maintained through a signed annual declaration from the claimant (i.e. that confirms his or her unemployment and retirement from the workforce) and are reckonable for the Widow's/Widower's (Contributory) Pension, the Deserted Wife's Benefit, the Guardian's Payment (Contributory) and occupational injuries benefits only.
From July 4th, 2007 the Scheme was discontinued for new entrants. This was done in conjunction with the phasing out the Pre-Retirement Allowance (PRETA) and is consistent with efforts being made to encourage and facilitate people to continue working up to and beyond pension age. Labour market conditions have improved dramatically since the introduction of PRETA in 1990. The practical effect of conditions in 1990 was that many long-term unemployed persons over 55 years of age were unlikely to work again, and it was not meaningful to continue to ask them to prove that they were actively seeking employment. The drop in long-term unemployment since that time has meant that this rationale has largely disappeared.
People of working age who are no longer liable for PRSI contributions may opt to protect their pension entitlements by applying to become a voluntary contributor. In order to be admitted to the voluntary contributions scheme, a person must have a minimum of 260 weeks of PRSI paid in either employment or self-employment and apply within 12 months of being insurable. The requirement to have 260 paid contributions to gain access to the scheme is essential in that it ensures that the requisite number of paid contributions required is in place to establish a contributory pension entitlement.
