Dáil Éireann Debate, Tuesday - 11 June 2013
458. Deputy Clare Daly asked the Minister for Social Protection in relation to the ability of self-employed persons to access pension benefits where a tax liability is outstanding, to make the payment to the person upon reaching the qualifying age, but deducting the amount owed from the weekly payments rather than disallowing the pension to be activated until the liability is cleared. [27768/13]
View answerThe State pension is a very valuable asset and it is important, for sustainability reasons, that those who receive it have made a significant contribution towards it during a working life.
Ordinarily, in order to qualify for a State pension (contributory), a person must satisfy a number of qualifying conditions which include commencing insurable employment at least 10 years before pension age, having a minimum of 520 qualifying PRSI contributions and achieving a yearly average of at least 10 qualifying contributions, paid or credited, over their working life.
Social insurance contributions (Class S PRSI) were introduced for self-employed people on 6 April 1988. This provides cover for self-employed people for long-term benefits such as State pension (contributory) and widows/widowers pension (contributory). In addition to the qualifying conditions above, a person must have paid self-employment contributions in respect of at least one contribution year and all self-employment contributions payable must be paid in full. With effect from 1 January 2010, a pension can only be awarded with effect from the date that the claimant has fully discharged all their Class S contribution liabilities, even where this date may be after their 66th birthday.
The Revenue Commissioners are the primary collection agents of the Department in relation to income tax and outstanding PRSI. These are aggregated sums and cannot be separated for pension eligibility purposes. These provisions are consistent with the contributory and solidarity principles which underpin the social insurance system. There are no plans to change these provisions.
It is worth noting that the recently published Actuarial Review of the Social Insurance Fund found that the self-employed achieve very good value for money from the fund compared with the employed. For those who are unable to meet the qualifying conditions for State pension, the means-tested State pension (non-contributory) may be available to people on low incomes who do not meet the qualifying criteria for State pension.
