Richard Boyd Barrett
Ceist:136. Deputy Richard Boyd Barrett asked the Minister for Social Protection the estimated full-year cost of reinstating the transitionary pension. [25690/20]
Amharc ar fhreagraWednesday, 23 September 2020
Ceisteanna (136)
Freagraí scríofa
When State Pension (Transition) existed, it was a scheme which allowed those who were retired to get a transitionary payment between the ages of 65 and 66 years. The maximum personal rate was equivalent to the then maximum rate for the State Pension (Contributory). Eligibility was based on PRSI contributions and credits. It is important to note that the conditions and eligibility requirements for State Pension (Transition) were different to those for the State Pension (Contributory). For example, a person had to have a minimum average of 24 contributions per annum to be eligible for the previous model of State Pension (Transition) whereas an average of 10 contributions per annum is required for State Pension (Contributory) eligibility. In addition, recipients of the previous model of State Pension (Transition) were not eligible for Free Travel, the Household Benefits Package (electricity, gas, TV licence) or Living Alone Allowance.
My Department’s best current estimate for the gross cost of reintroducing State Pension (Transition), on the same basis as it previously operated, is €293 million for a full year. It is expected that these costs would be offset somewhat by savings of €166 million on Working Age Schemes, arising from recipients transferring from these schemes to State Pension (Transition), giving a net cost of €127 million each year. These figures are based on current payment rates. This costing was calculated based on analysis of the observed ratio of State Pension (Transition) awards to State Pension (Contributory) awards for the period from 2009 to 2012, and projecting this forward in terms of estimated recipient numbers in coming years. It should be noted that these costings are subject to change in the context of emerging trends and associated revisions of the estimated numbers of recipients.
The Programme for Government “Our Shared Future” commits to introducing a Retirement Payment for 65 year olds paid at the same rate as Jobseeker's Benefit without a requirement to sign on, partake in any activation measures or be available for and genuinely seeking work. I wish to assure the Deputy that I have made the introduction of the new Retirement Payment an immediate priority for my Department. Officials in my Department are currently considering the design of the scheme and assessing the necessary legislation, ICT system requirements and administrative processes required to support the introduction of this payment. The Programme for Government also states that the planned increase in the State Pension Age next year will be deferred and it will remain at 66 years. Subject to Government approval, it is my intention to bring the necessary legislation for both of these initiatives before the Oireachtas later this year.
I hope this clarifies the matter for the Deputy.