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State Pensions

Dáil Éireann Debate, Tuesday - 26 April 2022

Tuesday, 26 April 2022

Questions (1005)

Claire Kerrane


1005. Deputy Claire Kerrane asked the Minister for Social Protection if consideration is being given to including foster carers within a State pension solution for carers given that she is due to report on updates to the State pension in the coming weeks; and if she will make a statement on the matter. [19765/22]

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Written answers (Question to Social)

Subject to the standard qualifying conditions for State Pension (Contributory) also being satisfied, the State Pension system already provides significant recognition to those whose work history includes an extended period of time outside the paid workplace, often to raise families or in a full-time caring role.

This is provided through the award of Credits, the application of the Homemaker’s Scheme (under the Yearly Average method for payment calculation) and/or the application of HomeCaring Periods (under the interim Total Contributions Approach also known as the Aggregated Contribution Method). 

Details of these are: 

- Credits – PRSI Credits are awarded to recipients of Carer’s Allowance (and Carer’s Benefit) where they have an underlying entitlement to credits. Credits are also awarded to workers who take unpaid Carer’s Leave from work.

- The Homemaker’s Scheme - The scheme, which was introduced with effect from 1994, is designed to help homemakers and carers qualify for State Pension (Contributory).  The Scheme, which allows periods caring for children or people with a caring need to be disregarded (from 1994), can have the effect of increasing a person's Yearly Average.

- HomeCaring Periods – HomeCaring Periods may be awarded for each week not already covered by a paid or credited social insurance contribution (regardless of when they occurred) to a maximum of 20 years.  HomeCaring Periods can only be used under the Interim Total Contributions Approach of pension calculation. 

Since April 2019, all new State (Contributory) Pension applications are assessed under all possible rate calculation methods, including the Yearly Average and the Interim Total Contributions Approach, with the most beneficial rate paid to the pensioner.  The elements which make up each method are set out in legislation. 

Foster parents are entitled to the benefits of the Homemakers Scheme or HomeCaring Periods, on the same basis as other homemakers, and will qualify automatically if the carer is in receipt of Child Benefit.  If the foster parent is not in receipt of Child Benefit s/he can still qualify for the Homemaker’s scheme or HomeCaring Periods provided the caring periods are confirmed by Tusla.

It should be noted that if a person does not satisfy the conditionality to qualify for the State Pension (Contributory), s/he 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 his/her spouse is a State pensioner and has significant household means, his/her most beneficial payment may be an Increase for a Qualified Adult, based on his/her personal means, and amounting to up to 90% of a full contributory pension. 

The Pensions Commission’s Report was published on 7th October 2021.  It established that the current State Pension system is not sustainable into the future and that changes are needed.  The report set out a wide-range of recommendations in relation to the State Pension system and Social Insurance Fund, including enhanced pension provision for long-term carers (who are caring for over 20 years).

In the interests both of older people and future generations of older people, the Government intends to consider the comprehensive and far reaching recommendations in the Pensions Commission’s Report very carefully and holistically.  My officials are examining each of the recommendations and consulting across Government through the Cabinet Committee system.  The Joint Oireachtas Committee on Social Protection and the Commission on Taxation and Welfare have submitted their views on the recommendations.  These various views will be considered carefully as part of the Government's deliberations.

It is really important that we complete that work before reaching conclusions on any one recommendation, such as the recommendations related to long-term carers.  In this regard, I intend bringing a recommended response and implementation plan to Government in the coming weeks.  

The State Pension is the bedrock of the pension system in Ireland.  It is extremely effective at ensuring that our pensioners do not experience poverty.  This Government is committed to ensuring that this remains the case for current pensioners, those nearing State Pension age and today’s young workers including those who are only starting their careers.

I hope this clarifies the matter for the Deputy.