An Oireachtas Committee has recommended that the pension age in Ireland should increase from 70 to 75. The Oireachtas Social Protection Committee said its recommendation was made in light of the fact life expectancy has increased from 65 to 82 years old.
The Commission on Pensions was established in November 2020, tasked with examining the sustainability and eligibility issues in relation to the State pension system and the Social Insurance Fund. It published its report in October 2021, and in September last year, the Government put forward its own response and implementation plan.
The General Scheme of this Bill also explores the provision for people to be given the choice to work until they are aged 70 in return for a higher rate of State pension.
The Department of Social Protection pledged in September that the State Pension (Contributory) will become more flexible, and that access to the State Pension will improve for long-term carers in changes set to be implemented. It also said it would introduce a “fairer” method for people to calculatetheir State pension.
The report on the pre-legislative scrutiny of the General Scheme of the Social Welfare (Amendment) Bill 2023 was published on Tuesday.
In its report, the Committee recommended “that the cut off age of 70 be replaced with 75 and that the enhanced pension would keep increasing until the individual starts drawing down their pension or reaches 75, in light of the fact that life expectancy has increased from 65 to 82 years old.”
Other recommendations included a proposal that the Total Contribution Calculation be based on 30 years as opposed to 40 years’ worth of contributions; and that the Department of Social Protection should introduce an awareness campaign regarding pension entitlements for people who may have periods where they have not made pension contributions, such as carers, and ensure they are aware of the pension implications; and that the actuarial calculation for Pension enhancement over 66 years be applied to the Qualified Adult Allowance.
Other recommendations which will be considered include treating periods on Farm Assist retrospectively similar to Jobseekers Allowance, along with the granting of a credited contribution for all years a farmer was on Farm Assist in order to facilitate people approaching pension age who will not have an entitlement to contributory pensions, such as small farms and fishers who have been in receipt of farm assist or fish assist payments.
It has also recommended that home caring credit should cover the full period of all children reaching 12 years old rather than the 20-year block proposed in the general scheme. It said this would help avoid a situation whereby if there is a gap of greater than eight years between the birth of the oldest and the youngest child, the stay-at-home carer loses out on the benefit because of the children’s age gap.
In addition, it made the recommendation for the reinstatement of a retrospective process where partners actively working on farms will be eligible to make PRSI contributions for a contributory pension – and that certain provisions be put in place to allow foster carers to avail of long term foster care credit, similar to carers.
It also recommended that all new measures be implemented from the date of enactment of the Bill.
At present, the qualifying age for all State pensions is 66. However, changes to the State Pension (Contributory) are being introduced on the basis that people are living longer, are healthier, and are living more active lives – meaning more people avail of State pensions for longer, according to the Department of Social Protection.
A CSO report from August found that Ireland has the highest male life expectancy in the EU – with male life expectancy at birth sitting at 80.8 years in 2020. This was 3.3 years more than the EU average.
Female life expectancy also topped the EU average by 1.2 years, at 84.4 years.
A Department of Health report from December last year found that Ireland’s population is ageing faster than any other country in Europe, which is predicted to put significant strain on the healthcare system and other national services.
The report, “Health In Ireland – Key Trends,” said that there are five taxpaying workers for every one pensioner over the age of 65. However, based on current birthrates, in 20 years time this ratio will drop to three to one.
This could lead to young workers being taxed at a far higher rate than they are currently to support the bigger proportion of elderly citizens within the state.
Meanwhile, the population of those over 65 in Ireland has grown by 35% in the past 10 years, which is a faster rate than the rest of Europe. This age group is expected to double over the next 20 years, and will be projected to make up more one-third of the working population, compared to one-fifth now.
There will also be a large proportional increase in those over the age of 85.
The report claims that this will make it difficult to adequately fund services such as the healthcare system, as older people are naturally in need of more resources than younger individuals. Most hospital beds are occupied by those over the age of 65, for example.
Authors of the report note: “It is good that people are living longer, but we need to ensure that more of these years, particularly in later life, are spent in good health.”
They add that Ireland’s demographics will remain “the singular challenge we face when planning our health service into the future.”
Meanwhile, birthrates in Ireland have continued to drop, with births being down by one-fifth.
Loading ...
Billions available for welfare for people who contributed nothing to this country but the peasants must work until they drop to pay for it.
Current pension contributions are only covering pension outgoings. As far as I’m concerned pensions in the current format are just a Ponzi scheme.
There is no possibility of Planning for the future of Ireland, when Open Door Migration throws all calculation out the window,
Pension Planning is a Mathematical process used by pension Actuaries based on constant trends. No constants destroy the calculations .
On another vein ,this proposed raising of the Pension age and recent Regime utterances on the migration capacity of Ireland ,indicates that the well is running dry in the Dept of Finance. and reality is beginning to assert itself.
Much too late,the defecation is about to hit the rotation.
Indeed, and we’re all getting spattered with said defecation.
It was always like that Emmet. This is not a flaw in the system, it was designed like that. With a pension age of 66 and in the past an average age of death of 65. Our politicians planned on paying very few pensions. After 40 years of being bullying people in to stopping smoking and improving their diet and exercise routine the average age of death has risen by 17 years. The government should be very pleased instead of carping about people taking back the money they paid in over decades.
I wonder if the new pension age will also apply to ministerial and Dail pensions. Will the civil service, Guards and teachers have to soldier on untill 75 ?. After all that most fashionable of new buzz words “equity” demands that they should. Then there is the billions given to our great value NGOs and our new freeloading guests. Somebody has to pay for that so let’s screw the old. Great plan Ministers. Sure what could possibly go wrong. Remember these people when you vote.
Vive le France. They sure let tgeir feelings be kniwn about raising pension age
Jobs involving physical fitness should have early retirement. But these people could then becre deployed as instructors. Mentors. Supervisirs
First stop, eliminate 11 taoiseach choice senators their salaries their pensions
I believe read the word “choice” in te transcript?h