Dáil Éireann Debate, Thursday - 8 July 2021
263. Deputy Kieran O'Donnell asked the Minister for Social Protection if homemaker's credits will be added to the social insurance record of a person (details supplied); and if a higher rate of pension will be awarded to them. [37036/21]
View answerThe person concerned reached pension age on 8 June 2015. According to the records of my Department, they had a total of 1,035 qualifying full-rate paid and credited contributions from their date of entry into insurable employment on 8 June 1965 to end-December 2014.
The Homemakers Scheme was applied to the calculation of the person’s pension entitlement under the yearly average method. This scheme was introduced on 6 April 1994 and allows up to 20 years (since 1994) spent caring for children under 12 years of age or for incapacitated person(s) to be disregarded in calculating an applicant’s yearly average, and for homemaker credits to be awarded for homemaking periods of less than a full contribution year. The effect of this is to reduce the number of years by which an applicant’s contributions are divided, thereby increasing their yearly average and making it easier for them to qualify for the most beneficial rate of state pension (contributory).
This person’s yearly average was calculated as 26 contributions and gave them an entitlement to a standard State pension (contributory) at 85% of the maximum rate. They were notified in writing of this decision on 5 June 2015.
An interim Total Contributions Approach (TCA), also known as the Aggregated Contributions Method, was introduced in January 2018 as an alternative to the yearly average method of calculating pension entitlement for those State pension (contributory) customers born on or after 1 September 1946 and therefore affected by post-2012 Budget pension rates. The TCA provides for up to 20 years of HomeCaring Periods (HCP) in their pension entitlement calculation for applicants who took time out of the workplace for parenting or caring duties.
The person concerned was invited on 4 April 2019 to apply for HCP and to have their pension reviewed, but did not respond at that time. Their application for HCP was received on 12 May 2021 by my Department and 1,222 HCP credited contributions were awarded in respect of childcaring duties for the person's five children. A maximum of 1,040 HCP plus credited contributions can be used in the calculation of an applicant's pension entitlement under the interim TCA.
On review of their State pension (contributory) entitlement, their rate of pension increased from 85% to 95% of the maximum pension. The revised decision issued to them in writing on 25 May 2021 with details of arrears due, backdated to 30 March 2018, in line with social welfare legislation.
The person concerned is now in receipt of the correct rate of pension payable commensurate with their social insurance record held by my Department.
I hope this clarifies the position for the Deputy.
