Dáil Éireann Debate, Wednesday - 3 June 2020
1114. Deputy John McGuinness asked the Minister for Employment Affairs and Social Protection if she has considered giving further relief to a greater number of women who stayed at home to raise their family at a time in their lives when they could have gone back to work; if the proposal has been examined in terms of the numbers who may qualify; and if so, the estimated cost. [9074/20]
View answerA person is required to have a minimum of 520 paid reckonable PRSI contributions in order to qualify for the State Pension (Contributory). The actuarial value of the State Pension is estimated at over €300,000 which requires people who claim a contributory pension to have made at least 10 years of paid contributions over 50 years of a working age life.
When I introduced the Interim Total Contributions Approach (TCA) it included provision for the HomeCaring Periods Scheme which fundamentally changed the entitlement of many who spent time out of the workforce caring for others. It, for the first time, acknowledged home caring periods prior to 1994. Interim TCA provides for up to 20 years of home caring periods to be considered. Those who have a 40 year record of paid and credited social insurance contributions, subject to a maximum of 20 years of credits/homecaring periods, qualify for a maximum contributory pension where they satisfy the other qualifying conditions for the scheme.
Work began on the examining the social insurance records of over 90,000 pensioners in September 2018. Where these reviews resulted in an increase in the pensioner’s rate of payment, the increase was backdated to 30 March 2018 or the pensioners 66th birthday, whichever was the later. As at the end of October 2019, with the project completed, 94,258 reviews have been finalised; of these, 53,092 (56%) are women and 41,166 (44%) are men. Of the 53,092 women reviewed 28,528 (54%) received an increase while the rest remain on their existing rate. Of the 41,166 men reviewed, 9,956 (24%) received an increase and the remainder continue to received their same rate of payment. No pensioner had their pension payment reduced as part of this review.
From April 2019, all new State (Contributory) Pension applications are assessed under all possible rate calculation methods, including the Interim TCA, with the most beneficial rate paid to the pensioner.
It should be noted if a person does not satisfy those conditions, they may qualify for the means-tested State Pension (Non-Contributory), the maximum rate of which is over 95% that of the maximum rate of the State Pension (Contributory). Alternatively, if their spouse is a State pensioner and they have significant household means, their most beneficial payment may be an Increase for a Qualified Adult, based on their personal means, and amounting up to 90% of a full contributory pension.
The Total Contributions Approach (TCA), when it is introduced, is intended to be a fairer and more transparent system where the person’s lifetime contribution will be more closely reflected in the benefit received. Having carefully examined the outputs of the TCA consultation process, officials in the Department are designing the scheme, with a view to including significant recognition for home caring periods in the new model. The final design for the TCA model will need to be brought to Government for consideration and approval. As eligibility under the scheme and associated costs are dependent on its design and parameters, it is not possible at this stage to estimate the numbers that may qualify and associated costs.
I hope this clarifies the matter for the Deputy.
