Dáil Éireann Debate, Tuesday - 7 November 2017
1268. Deputy Jim O'Callaghan asked the Minister for Employment Affairs and Social Protection the way in which entitlement to a contributory pension is calculated when a person has a combined Irish and EU record; the basis whereby a person may qualify for a reduced rate pro rata EU state pension; the reason this may be paid at a lower rate than the full rate of the State contributory pension; and if she will make a statement on the matter. [46923/17]
Amharc ar fhreagraAn EU pro-rata state pension (contributory) may be payable to persons who have worked in Ireland and one or more EU countries who may not qualify for a pension on their Irish contributions alone, or who may qualify for a higher rate of pension based on a combination of Irish and EU contributions.
EU regulations lay down the general principles on the co-ordination of social security rights of persons moving and working within the EU. They are designed to ensure that these persons’ social security entitlements are protected as if they had remained in the one EU/EEA country during their working lives and also to ensure that they cannot make unfair gains in terms of social security entitlements.
Under EU regulations, a person’s social insurance record in one or more EU country can be combined with their Irish insurance record to give entitlement to a proportional or pro-rata pension. In calculating this pension, a person’s full-rate Irish contributions and EU full-rate contributions are taken into account.
First, the person’s theoretical pension entitlement is calculated by treating all the contributions as if all they were all Irish contributions and dividing that total number by the number of years of their social insurance employment history.
For example, if a person had a total of 2,542 contributions, both Irish and EU contributions, over a 50-year period, this would be 2,542 divided by 50 years, which would give a yearly average of 51 contributions. This would give a theoretical pension entitlement of €238.30.
The EU pro rata pension is then calculated from the theoretical pension by multiplying the theoretical rate (from step 1) by the number of Irish contributions and dividing it by the total number of all contributions. This figure is then rounded up to the nearest 10c.
Based on the above example, if the person had 446 Irish contributions within their total contributions of 2,542 this would give them an EU pro rata pension entitlement from Ireland of €41.81, rounded up to €41.90 per week. The higher the number of Irish contributions held, the higher the rate of entitlement of EU pro rata pension from Ireland.
I hope this clarifies the matter for the Deputy.
