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Invalidity Pension

Dáil Éireann Debate, Wednesday - 29 July 2020

Wednesday, 29 July 2020

Questions (242)

Richard Boyd Barrett

Question:

242. Deputy Richard Boyd Barrett asked the Minister for Employment Affairs and Social Protection if the requirements will be revised for invalidity pension that includes a claimant having to have 48 contributions in the two years prior to applying if they have the other requirement of not less than 260 contributions in total (details supplied) and if she will make a statement on the matter. [19546/20]

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Written answers

Social insurance benefits are made available on the basis that when a certain contingency or risk materialises the person involved will need a replacement income. Benefits are intended to replace lost income where a person is, for some reason, not able to engage with the labour force.  Where there is no recent history of contributions being paid or credited then there is no entitlement to most benefits.

Invalidity pension is a substantial and long-term payment for persons who are permanently incapable of work and who satisfy the social insurance conditions. A total of 260 weeks contributions paid and 48 weeks contributions paid or credited in the last complete tax year before the relevant date or in the tax year before the last complete tax year are required to satisfy the PRSI conditions for Invalidity Pension. The reckonable contribution classes are A, E, H and S.

A person on reduced working hours may continue to access social insurance. Currently, there is no set number of hours per week that must be worked to access social insurance. Until 1991 the threshold for access to social insurance was based on hours worked – 18 hours. From April 1991 onwards, a person was insurable at the Class A rate of PRSI if their income equaled or exceeded £25 per week.  This threshold was increased to £30 per week from April 1994 and upon conversion to Euro the £30 threshold became €38.

Therefore, based on the current national minimum wage hourly rate of €10.10, an employee working under 4 hours per week gains access to the full range of social insurance benefits.

A person who is not working may keep up their contribution record in a number of ways. One of these is by credited contributions. A credited contribution is a PRSI contribution awarded to an insured person under certain circumstances, such as proved unemployment. Credited contributions are an integral part of the social insurance system. For the most part they are linked to having an underlying entitlement to a social welfare payment while temporarily detached from the labour force or having entitlement to statutory leave. The primary purpose of credited contributions is to secure social welfare benefits and pensions of employees by covering gaps in insurance where they are not in a position to pay PRSI such as during periods of unemployment, illness, etc. Credits ensure that a person’s insurance record is maintained and can be helpful at a later stage to qualify for other social welfare benefits, such as pensions or to increase the rate of pension that may become payable.

 Appropriate social insurance contributions paid in another European Union Member-State can count for the purpose of bridging a contribution gap – provided that one social insurance contribution is made in Ireland.

Persons who have an insufficient contribution record to qualify for a social insurance benefit may apply for the appropriate means-tested social assistance scheme. For example persons between the ages of 16 and 66 who are suffering from an illness or disability which is expected to last at least 1 year, may qualify for Disability Allowance. Disability Allowance recipients must be habitually resident in the State.

Given that people can count contributions in a range of ways as outlined above, and that credited contributions are awarded in a wide range of circumstances, I do not have plans to change the contribution conditions for Invalidity Pension at this time. 

Any changes to scheme qualifying criteria would have to be considered in a budgetary context. 

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