The home-makers scheme makes qualification for a higher rate of State pension (contributory) easier for those who take time out of the workforce for caring duties. The scheme, which was introduced in and took effect for periods from 1994, allows up to 20 years spent caring for children under 12 years of age (or caring for incapacitated people over that age) to be disregarded when a person’s social insurance record is being averaged for pension purposes, subject to the standard qualifying conditions for State pension contributory also being satisfied. This has the effect of increasing the yearly average of pensioners, which is used to set the rate of their pension.
My Department has estimated that the annual cost of extending the Homemakers scheme to allow people to avail of the full 20 years currently allowed under the scheme, encompassing periods prior to 1994, could cost some €290 million in 2017, and this figure would rise at a faster rate than the rate of the overall cost of State pensions. This is a very significant cost, and the main beneficiaries would be people who already have significant household means, and who do not therefore qualify for a means-tested payment.
Changing the Homemakers scheme from one of disregarded years under calculation of the SPC’s Yearly Average calculation, to one of reckonable credits for the purposes of use in qualifying for other schemes under my Department’s responsibility, would have to be considered in the context of the Budgetary process, the available resources, and the competing demands for funds in my Department.
I hope this clarifies the matter for the Deputy.
