Dáil Éireann díospóireacht -
Wednesday, 22 Oct 2003

Vol. 573 No. 1

Written Answers. - Pension Provisions.

Jack Wall

Ceist:

80 Mr. Wall asked the Minister for Social and Family Affairs the number of persons currently in receipt of a State pension; her Department's assessment of the numbers of people likely to be in receipt of State pensions over the next decade; the provisions which are now being made in that regard; and if she will make a statement on the matter. [24219/03]

Minister for Social and Family Affairs (Mary Coughlan)

At end of December 2002, there were 188,350 people receiving an old age contributory or retirement pension. A recent actuarial review of the social insurance fund, undertaken by the Government Actuary Department in the UK, presented that the number of recipients of these pensions will increase to 255,000 by 2011 and 321,000 by 2016. The increase will, to some extent, be balanced by a reduction in the number of people receiving the old age non-contributory pension. The numbers receiving this pension are down over 20% in the past ten years which reflects improved social insurance coverage and increased labour force participation, particularly among women.

In common with other European countries, the population of Ireland is ageing as a result of a combination of increasing life expectancy and a declining birth rate. The decline in the birth rate is relatively recent and this, coupled with the effects of high emigration for much of the period up to the 1990s, has resulted in Ireland having the lowest proportion of older people in the EU – 11.2% aged 65 and over, as compared to the current EU average of 16.1%.

The proportion of older people in Ireland will remain at much the same level for roughly the next ten years after which it is projected to increase rapidly to 15% in 2021, 19% in 2031 and 28% in 2056. A similar situation exists in relation to the numbers at work relative to the number of pensioners.

Given that the situation will remain relatively stable for the next ten years or so, no particular measures are planned in that timescale. However, the Government is making preparations, through the national pensions reserve fund, to part fund pensions costs from 2025 onwards.

As the Deputy will be aware, pensions have been an important issue at EU level over the past year or so. This is not surprising given that the challenges facing pensions systems are more immediate for other member states. The EU has been assessing national pensions systems under agreed objectives in the area of adequacy, financial sustainability and modernisation. In this regard, a joint EU Commission and Council report published earlier this year considered that Ireland has made good progress in ensuring both financial sustainability in our pensions system.

The report considered that the public system therefore appears to be, in broad terms, financially sustainable despite projected major increases in future pensions expenditure. We will continue to monitor the situation closely.