The State pension contributory is a very valuable benefit and is the bedrock of the Irish pension system. Therefore, it is important to ensure that those qualifying have made a sustained contribution to the Social Insurance Fund over their working lives. To ensure that the individual can maximise their entitlement to a State pension, all contributions paid or credited over their working life from when they first enter insurable employment until pension age are taken into account when assessing their entitlement and the level of that entitlement.
One of the conditions of the State pension contributory is that a person needs a minimum of 520 weekly contributions (i.e. 10 years) paid since entering insurable employment. If a person does not have this minimum number of contributions paid, they will not generally have an entitlement to this particular pension, either at a full or reduced rate. Since 1961, when contributory pensions were introduced, the average contributions test has been used in calculating the rate of pension entitlement. Entitlement is banded, with the maximum rate payable to those with a yearly average of 48-52 contributions, and the minimum rate payable to those with a yearly average in the range of 10-14 contributions per year. Even if someone has only 10 years (520 weeks) of paid reckonable contributions between their 16th and 66th birthdays, they would generally qualify for a State pension (contributory), although the rate payable would vary depending on their circumstances, and it will not always be their most advantageous payment to claim.
The homemaker’s scheme makes qualification for a higher rate of State pension (contributory) easier for those who take time out of the workforce for caring duties. The scheme, which was introduced in and took effect from 1994, allows up to 20 years spent caring for children under 12 years of age (or caring for incapacitated people over that age) to be disregarded when a person’s social insurance record is being averaged for pension purposes, subject to the standard qualifying conditions for State pension contributory also being satisfied.
Where people who were unattached to the labour market during most of their adult lives cannot qualify for a contributory pension in their own right as they have paid few or no contributions, or cannot qualify for a full rate as a result of an intermittent PRSI record, the social protection system provides alternative methods of supporting such pensioners in old age. Therefore, if their spouse has a contributory pension, they may qualify for an Increase for a Qualified Adult amounting up to 90% of a full rate pension, which by default is paid directly to them. Alternatively, they may qualify for a means-tested State Pension (non-contributory), amounting to up to 95% of the maximum contributory pension rate.
There are a number of reasons why someone might not have sufficient contributions paid to qualify for a State pension (contributory). Some would have been employed in the public service, others would have worked abroad and qualified for a foreign pension based on foreign contributions, and some would have spent significant periods out of the labour force altogether for a number of reasons, e.g. caring for children or elderly relatives, prolonged periods of unemployment or incapacity and other circumstances. In some cases, a person might never have been in insurable employment. If such people do not claim a State pension, their details will not form part of the statistics generated by management of those schemes.
Therefore there are no statistics available to my Department detailing the number of people who spent period(s) outside the Irish labour market, and who, as a direct result of those periods, would not qualify for a State pension. Such statistics would comprise largely of people who have not paid PRSI for many decades, and who in many cases would not have made a claim under the State pension system.
Public service pensions are a matter for the Minister for Public Expenditure and Reform.
I hope this clarifies the matter for the Deputy.
