Aengus Ó Snodaigh
Question:283 Deputy Aengus Ó Snodaigh asked the Minister for Social Protection the changes she intends to make to State pensions; and the timeframe for same. [34674/12]
View answerTuesday, 17 July 2012
Questions (280)
Written answers
I want to take this opportunity to again explain why we are making changes to State pension provision. As Irish society has changed, pensions policy has evolved to reflect these changes. A key focus of mine has been to ensure that the State pension is sustainable in light of demographic changes and the associated increases in pension costs.
This is compounded by the wider need for sustainable public finances. So our primary consideration in making the changes we have made to reform pensions has been to ensure that retirement income remains adequate and is on a financially sound and sustainable footing
Under the pensions reform programme, the following reform measures are underway:
With effect from April 2012, the number of paid contributions required has increased from 260 contributions to 520 paid contributions.
While the current State pension age of 66 remains, the State pension (transition) which applies for one year for persons of age 65 will cease from 2014.
Thereafter, State pension age will increase to 67 in 2021 and 68 in 2028.
From September 2012, additional rates bands for State pension (transition) and State pension (contributory) will be introduced to more fairly reflect the attachment to the workforce by the claimant.
The maximum rate will remain unchanged and the rate payable to people with an average of between 40 and 47 contributions per year will also remain unchanged. However, those who have fewer contributions will receive a lower rate of pension. This change moves somewhat closer to the total contribution approach where those who pay more, benefit more. The new rate bands are outlined below:
In the future, a ‘total contributions approach' to State pension will be adopted to replace the current averaging system. Under this system, the level of pension paid will be directly proportionate to the number of social insurance contributions made by a person over his or her working life.
The State pension is the bedrock of the Irish pension system, and these reforms are essential to address the challenges of increasing life expectancy and to ensure its sustainability.
All information relating to the changes that I have outlined here and the table are available on my Department's website.
|
Yearly average contributions |
Personal Rateper week |
Increase for Qualified Adult aged under 66 yearsRate per week |
Increase for Qualified Adult aged over 66 yearsRate per week |
|
48 or over |
€230.30 |
€153.50 |
€206.30 |
|
20-47 |
€225.80 |
€153.50 |
€206.30 |
|
15-19 |
€172.70 |
€115.10 |
€154.70 |
|
10-14 |
€115.20 |
€76.80 |
€103.20 |
|
Yearly average contributions |
Personal Rateper week |
Increase for Qualified Adult aged under 66 yearsRate per week |
Increase for Qualified Adult aged over 66 yearsRate per week |
|
48 or over |
€230.30 |
€153.50 |
€206.30 |
|
40-47 |
€225.80 |
€146.00 |
€196.00 |
|
30-39 |
€207.00 |
€139.00 |
€186.00 |
|
20-29 |
€196.00 |
€130.00 |
€175.00 |
|
15-19 |
€150.00 |
€100.00 |
€134.00 |
|
10-14 |
€92.00 |
€61.00 |
€83.00 |
|
Yearly average contributions |
Personal Rateper week |
Increase for Qualified Adult aged under 66 yearsRate per week |
Increase for Qualified Adult aged over 66 yearsRate per week |
|
48 or over |
€230.30 |
€153.50 |
€206.30 |
|
24-47 |
€225.80 |
€153.50 |
€206.30 |
|
Yearly average contributions |
Personal Rateper week |
Increase for Qualified Adult aged under 66 yearsRate per week |
Increase for Qualified Adult aged over 66 yearsRate per week |
|
48 or over |
€230.30 |
€153.50 |
€206.30 |
|
40-47 |
€225.80 |
€146.00 |
€196.00 |
|
30-39 |
€207.00 |
€139.00 |
€186.00 |
|
24-29 |
€196.00 |
€130.00 |
€175.00 |