Dáil Éireann Debate, Wednesday - 25 May 2022
121. Deputy Patricia Ryan asked the Minister for Social Protection the estimated cost of indexing core social welfare rates to 35% of average weekly earnings; and if she will make a statement on the matter. [26599/22]
Amharc ar fhreagraIn recent years, on foot of a commitment in the Roadmap for Pensions Reform (2018), my Department has developed proposals for a system of indexation for the State Pension (Contributory) scheme known as the “smoothed earnings” approach.
This approach aims to ensure that the relative value of State Pension (Contributory) compared to market earnings would be maintained over time and that, in the short-term, the real value, or purchasing power, of these payments would be protected.
More recently, the Pensions Commission report examined the issue of benchmarking pension rates and endorsed implementation of the “smoothed earnings” approach. The recommendations of the Pensions Commission are being considered at present and I plan to bring an overall proposal to Government in the coming weeks.
My Department has also committed, through the Roadmap for Social Inclusion, to examining a benchmarking and indexation approach for working age payments.
The estimated full year cost of indexing all core weekly social welfare payments to 35% of average weekly regular earnings in 2021, with proportionate increases for qualified adults is €3.1 billion annually.
This estimate is based on the estimated number of recipients in 2022 and is subject to change in light of emerging trends and subsequent revision of the estimated number of recipients.
