Tuesday, 24 September 2019

Questions (534)

Fiona O'Loughlin


534. Deputy Fiona O'Loughlin asked the Minister for Employment Affairs and Social Protection if the case of a person (details supplied) will be examined; and if she will make a statement on the matter. [38850/19]

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Written answers (Question to Employment)

In February 2018, the Government announced a new interim Total Contribution Approach (TCA) option for state pension (contributory) for those affected by the Budget 2012 rate band changes. This interim pension calculation is based on a requirement of forty years of social insurance contributions for qualification for maximum rate pension. The measures also provide for inclusion of up to twenty years of HomeCaring periods for time spend out of the workforce for parenting or caring reasons.

Homecaring periods are not time bound, they can occur at any time during a claimant's working life. This differs from the existing Homemakers scheme, which applies a disregard for periods out of the workforce for caring duties, after April 1994, under the yearly averaging system. This additional scope for homecaring periods provides an opportunity for those awarded under Budget 2012 rate bands, particularly women, who took time out of the work place to care for children and others, to achieve a higher rate of pension. The maximum number of combined HomeCaring periods and reckonable credits that can be used as part of the new pension calculation is 1,040 (or 20 years) as provided for under the Social Welfare Pensions & Civil Registration Act 2018.

The person concerned applied for and was awarded a reduced rate State pension (contributory) in 2016. As their spouse was already in receipt of an increase for qualified adult for them at a higher weekly rate of entitlement, their state pension (contributory) claim was subsequently withdrawn.

In July 2019, the person submitted an application for HomeCaring Periods and was awarded 1,279, the maximum possible number of HomeCaring periods in respect of time spent parenting their children. The person concerned has 755 paid social insurance contributions, which, when combined with the maximum permissible number of HomeCaring periods and reckonable credits of 1,040, results in a overall usable total of 1,795. When this number (1,795) is divided by 2,080 (equivalent to 40 years), this results in a payment entitlement rate of 86.30% of the maximum rate of pension. As the person concerned is already in receipt of a rate equivalent to 89.6% of the maximum rate of pension, (or €222.50 per week), they are financially better off to remain as a qualified adult on their spouse's pension.

A review outcome letter has issued to the person concerned, which includes a copy of their social insurance contribution record.

I hope this clarifies the matter for the Deputy.