The interim Aggregated Contributions Method of Total Contribution Approach (TCA12) makes it easier for many post-2012 pensioners affected by the 2012 rate band changes and assessed under the yearly average model, to qualify for a higher rate of the State pension (contributory).
When the Government decided, in January 2018, to announce an interim TCA option for those who had been affected by the change in rate bands in September 2012, 40 years of contributions was set as the requirement for a full rate pension. Crucially though this interim TCA facilitates up to 20 years of HomeCaring periods to be added to paid contributions to increase a person’s rate. It effectively meant that the minimum number of paid contributions of 20 years needed for a full rate pension would be as the National Pensions Framework suggested. However the additional scope for home caring would potentially allow more people, particularly women who took time out of the work place to care for children and others, to earn a higher rate pension.
PRSI contributions can be credited to people in a number of contexts and as such up to 10 years of credits, for example Jobseekers or illness Benefit, may also be used subject to the total of such credits and HomeCaring periods not exceeding 20 years. For example a person might receive a maximum pension based on a record of 20 years paid PRSI contributions, 5 years jobseekers credits, and 15 years HomeCaring (before or after 1994), over a 50 year period, despite additional gaps of up to 10 years.
There will be some people who have contributed less frequently into the Social Insurance Fund (which pays for contributory pensions), and who will therefore be below the threshold required for a maximum rate of the State pension (contributory). However, for those with insufficient contributions to meet the requirements for a State pension (contributory), they may qualify for a means tested State pension (non-contributory), the maximum personal rate for which is €237 (over 95% of the maximum rate of the contributory pension). This rate of payment does not include rent allowance, household benefits or fuel allowance. Alternatively, if their spouse is a State pensioner and they have significant household means, their most beneficial payment may be an Increase for a Qualified Adult, based on their personal means, and amounting up to 90% of a full contributory pension.
Finally, it should be noted that the introduction of the interim TCA model will not bring all pensioners up to the maximum rate of State pension (contributory). However, if a pensioner does not qualify for an increased rate, they will continue to receive their existing rate of entitlement.
I hope this clarifies the matter for the Deputy.