Permanent and pensionable employees in the public service, other than those who were recruited after 6 April, 1995, are liable to pay social insurance contributions at modified PRSI rates. Subject to having the required number of PRSI contributions, employees who pay modified contributions may be entitled to the following payments:
(a) widow’s/widower’s (contributory) pension and surviving civil partner’s (contributory) pension;
(b) guardians payment (contributory);
(c) bereavement grant, and
(d) carer’s benefit.
Modified rate contributions are not reckonable for establishing entitlement to State pension (contributory). Currently modified rate contributors are exempt from PRSI in respect of self-employed earned income (from a profession or trade) and any other unearned income. This exemption has been abolished in Budget 2013. All such income will become liable to PRSI at the rate of 4%. There will be no entitlement to social insurance benefits based on the payment of this contribution.