Vol. 456 No. 4
10 Mr. E. Ryan asked the Minister for Social Welfare the plans, if any, he has to abolish credited contributions and to replace them with criteria based on paid contributions only for social welfare benefit qualification purposes. [13954/95]
Credited contributions have been an integral feature of our system of social insurance since its inception. They are essential to preserving the continuity of insurance cover for social welfare benefit and pension purposes. They are awarded for the purpose of maintaining a person's social insurance entitlements, already acquired by virtue of previous contributions, when for reasons beyond their control they are unable to make the requisite contributions themselves. Contributions are credited to individuals in certain circumstances and under certain prescribed conditions. The most common of these relate to periods of certified incapacity for work due to illness— during which disability benefit may be payable—and periods of proved unemployment—during which unemployment benefit or unemployment assistance may be payable.
Credited contributions are reckonable only for the purposes of satisfying the second contribution condition applicable to social insurance benefits and pensions which requires that a minimum number of contributions be paid and-or credited in a specified period. That is usually the last complete tax year before the benefit year in which the claim is made. The first condition which must be satisfied requires a prescribed number of paid contributions, thereby ensuring a certain level of attachment to the social insurance system over the insurance lifetime of the insured worker.
Will the Minister of State agree that some workers who, for one reason or another, are in receipt of disabled person's maintenance allowance or some self-employed people, who before the self-employed social insurance contribution was introduced may have worked for perhaps 20 years from 1953 to 1973, are now losing out on pensions because they did not have credited contributions from 1973 to 1995? If they had not worked until 1973 and had worked from 1973 to 1993 they would be entitled to a full pension. Is the credits system, therefore, operating equitably?
This is a complex issue which requires change. There was an opportunity to address this problem in 1988 when a new Pensions Act was introduced to take into the scheme people who had been self-employed for a number of years. I presume the Deputy is referring to post-1953, not 1973. The problem is the average of contributions over the period of years. The earlier the person was registered in insurable employment the more difficult it is for that person to qualify for the minimum pension now.
I raised this issue on numerous occasions when I was in Opposition and, try as I might, I never managed to succeed in getting an answer that addressed the problem from those on the Government side, and not because they deliberately tried to avoid it. In so far as I can I will try to answer it. There is a case to be made for addressing the anomalies which have been raised by a number of Deputies on both sides of the House.
I would like to see the problem addressed. I indicated to the House previously that I have asked a group in the Department of Social Welfare to examine the matter with a view to identifying how best that problem can be addressed. The Pensions Board report dealt with this issue at some considerable length and, as it is the subject of another question, it would not be appropriate to proceed with the answer to it at this time.
