Dáil Éireann Debate, Tuesday - 6 November 2018
1120. Deputy Michael McGrath asked the Minister for Employment Affairs and Social Protection if persons affected by the planned increase in 2021 of the qualifying pension age to 67 years of age will receive a reckonable credit for State pension (contributory) purposes for the year between 66 and 67; and if she will make a statement on the matter. [45600/18]
View answerIncreasing pension age, to moderate the increase in pension duration, is a means by which pensions can be made more sustainable in the context of increasing longevity. In order to provide for sustainable pensions and to facilitate a longer working life, legislation passed in 2011 provides for an increase in the State pension age in three separate stages. In 2014, the State pension age was standardised at 66. This will be increased to 67 in 2021 and 68 in 2028.
The Deputy should note that there is no legally mandated retirement age in the State, and the age at which employees retire is a matter for the contract of employment between them and their employers. While such a contract may have been entered into with a retirement date which is now before pensionable age, in the context of the previous State pension arrangements, there is no legal impediment to the employer and employee agreeing to increase the duration of employment for one or more years, if both parties wish to do so.
In such circumstances, a person who has not yet attained pensionable age will generally pay PRSI in the normal way, as they would have when they were younger, and those paid contributions may be reckonable for State pension (contributory), if they would have been reckonable before reaching the age of 65. In some cases, they might not have been reckonable contributions, e.g. the modified contributions paid by some public servants are not reckonable for State pension (contributory) purposes. However, such employees generally have an occupational pension, the level of which is related to a number of factors, including years of service.
Where it is not possible to continue work, a person who has not yet reached pensionable age may be eligible for a working age payment, such as Jobseeker's Benefit or Allowance, and may be awarded credited contributions, in the same way a person aged under 65 might be. Whether that contribution is reckonable for State pension (contributory) purposes would depend upon their circumstances, notably the nature of their previous employment and the rate of PRSI contributions for which they had been liable.
I hope this clarifies the matter for the Deputy.
