Dáil Éireann Debate, Tuesday - 21 May 2024
387. Deputy Claire Kerrane asked the Minister for Social Protection to advise what percentage of average earnings the State pension (contributory) rate is currently; and if she will make a statement on the matter. [22519/24]
Amharc ar fhreagraThe Roadmap for Social Inclusion contains a commitment to develop a benchmarking approach for use in adjusting the value of State pension payments. The approach proposed by the Department, known as the 'smoothed earnings' approach, was subsequently endorsed by the Pensions Commission. Government subsequently decided that the Department of Social Protection would, in submitting budget options, set out a rate of pension payment calculated using the smoothed earnings benchmark approach as an input for consideration as part of overall Budget discussions, on an annual basis.
The smoothed earnings benchmark references both price and earnings elements in its calculation. The relevant CSO earnings statistic, published quarterly, is the Average weekly earnings, excluding irregular and overtime earnings. The smoothed earnings calculation averages this statistic over the most recently available 4 quarters of CSO data.
The current State Pension rate of €277.30 per week.
Average weekly earnings, excluding irregular and overtime earnings, is produced by the CSO, and is available on the CSO website (EHQ03, Average Earnings, Hours Worked, Employment and Labour Costs).
The CSO has released final values for this statistic in respect of Q1, Q2 and Q3 of 2023 and a preliminary value for Q4 2023.
Averaged over these four quarters, average weekly earnings are €834.70. The State Pension rate of €277.30 per week currently represents 33.2% of average weekly earnings.
Any changes to the State Pensions, both Contributory and non-Contributory would need to be considered in an overall budgetary and policy context. The smoothed earnings calculation will be assessed in the coming months and submitted for consideration of Government as part of the preparations in advance of Budget 2025.
