Dáil Éireann Debate, Tuesday - 22 March 2016
29. Deputy Michael Healy-Rae asked the Tánaiste and Minister for Social Protection the status of self-employed persons who are not entitled to claim a State pension; and if she will make a statement on the matter. [5096/16]
View answerSelf-employed persons pay PRSI at the class S rate of 4% and are covered for certain social insurance benefits and pensions, including the State pension (contributory). Employees pay Class A PRSI at the rate of 4% and are covered for a range of benefits and pensions, including the State pension (contributory). In addition, their employers generally make a PRSI contribution of 10.75%, resulting in the payment of a combined 14.75% rate per employee under full-rate PRSI Class A.
To establish entitlement to State pension (contributory), a contributor must, in the first instance, have paid at least 520 qualifying contributions by the time they reach pensionable age, currently 66 years. Once this condition is satisfied, a full or reduced weekly rate of pension is payable depending on the yearly average number of contributions paid over the period from commencement of employment/self-employment up to pension age (66).
The qualifying conditions for entitlement to State pension (contributory) apply to all classes of contributors and there is no differentiation in treatment for State pension (contributory) purposes between the self-employed and employees. In addition, it should be noted that the self-employed are awarded 52 contributions each year regardless of the number of weeks in which the self-employment was carried out in that year while employees are awarded contributions only in respect of the number of weeks worked.
Employees and the self-employed who reach 66 years and who do not satisfy the conditions for entitlement to the State pension (contributory) are eligible to apply for the means-tested State pension (non-contributory).
