Eoin Ó Broin
Ceist:378. Deputy Eoin Ó Broin asked the Minister for Social Protection to outline the process through which a person (details supplied) can defer their pension and extend their employment. [2388/24]
Amharc ar fhreagraTuesday, 23 January 2024
Ceisteanna (378)
Freagraí scríofa
The person concerned is in receipt of maximum rate Widow's Contributory Pension (WCP).
As this is a contributory pension, the person concerned can continue to have an income and remain entitled to this pension. On reaching age 66, the WCP will increase in rate to an amount equivalent to the maximum rate State Pension (contributory).
In September 2022, I announced a series of landmark reforms to the State Pension system in response to the recommendations from the Pensions Commission. This set of measures represents the biggest ever structural reform of the Irish State Pension system. One of the key measures is the introduction of a flexible pension system in Ireland. Under this new system, from January 2024, people will still be able to retire at 66 and draw-down their pension in exactly the same way as they can today. In addition, there will be new flexibility for those reaching State Pension age, so that people may choose to defer their pension, work longer and receive a higher pension payment, if they wish. The flexible State Pension system is about providing people with choice. People will decide for themselves what best suits their needs and circumstances. For example, in the case of a person who reaches age 66 and does not have sufficient contributions to qualify for a full pension, they will now have the option to work for longer to build up additional entitlements. If a person has less than 10 years PRSI reckonable paid contributions, they may be able to use this period of deferral to establish entitlement. A person will also have the option to continue working between age 66 and 70 and receive an actuarially based increase in their weekly payment rate, should they choose to defer their State Pension.
The person concerned is currently employed though the Job Initiative Scheme. This scheme was introduced in 1996 as an employment support designed to provide eligible long-term unemployed people and other disadvantaged persons with an opportunity to engage in useful work within their communities. Recruitment to the scheme ceased in 2004 and those on the scheme at that time were given a guarantee that they could remain on the scheme until they resigned voluntarily or reached age 66.
The position regarding funding for participants on Job Initiative, remains the same. Funding for participants will continue to be available up to State Pension Age, which is currently 66.
Certain social welfare payments such as WCP will continue to be available to those over age 66 who defer. However, if a person claims the WCP for any period during their deferral of state pension (contributory), that time will not be counted towards the actuarial increase in payment. The additional contributions acquired during the period can be used in the calculation of their SPC entitlement.
Further information about the changes in State pension (contributory) and how to calculate entitlement is available on the Government website at gov.ie/pensions.
I hope this clarifies the position for the Deputy.