Dáil Éireann Debate, Thursday - 7 December 2023
104. Deputy Joan Collins asked the Minister for Social Protection to confirm that benchmarking of the State pension will be included in Budget 2025 as per the Roadmap for Social Inclusion 2020-2025 (details supplied). [53990/23]
View answerThe Government agreed earlier this year that the Department of Social Protection would, in submitting budget options, set out the rate of pension payment using the smoothed earnings benchmark approach. I can confirm that this calculation was prepared and submitted to Government as an input into Budget preparations.In assessing options the Government was mindful, as it was last year, that the cost of living pressures were most acute over the winter period. For that reason, and rather than taking a simplistic approach to applying an indexed rate of increase to weekly rates of payment, the Government decided to 'front-load' supports through the provision of special payments including extra fuel allowance, working family, child benefit, carers', disability, qualified child and living alone payments. These payments are in addition not only to the €12 increase in the weekly payment rate, but to the Christmas bonus payments being made this week and an extra double week payments being made in January.
This combination of special payments plus a weekly rate increase, not only exceeds the value of a benchmarked increase but ensures that a significant proportion of this value is delivered when people need it most - over the winter period.
For example, the double payment to be made in January will have a value for a single pensioner of €277.30 – equivalent to over €5 per week, as does the double payment to be made this week – so over €10 per week in value from these two payments alone.
Pensioners living alone, and in receipt of Fuel Allowance will have received bonus payments of €500 – equivalent to a value of about a further €10 per week.
ESRI post budget analysis shows that the approach taken by the Government is progressive in nature and that households, including pensioner households, are better off compared to a purely indexed linked approach. Its analysis also showed that the approach taken benefited low income households the most and reduced their risk of poverty.
The Department of Social Protection will, for Budget 2025 and future budgets, continue to calculate the smoothed earnings benchmark for State Pensions and this will form an important input into Budget deliberations by Government.
