Pension anomalies to drag on until 2020
Around 42,000 people will have to wait until 2020 to have anomalies in their pensions addressed, the Taoiseach has confirmed.
Leo Varadkar told the Dáil the Government will not be immediately addressing pension inequalities, which mean people are losing as much as €1,500 a year.
Social Protection Minister Regina Doherty was forced into a U-turn on her “guarantee” to deal with the anomaly.
Tens of thousands of women who were impacted by the marriage bar, or who took time out of work to care for children, sick or elderly relatives are now being penalised as much as €35 each week as their PRSI contributions are averaged out from when they first began working when calculating the contributory pension.
Last week, Ms Doherty clearly signalled she would bring a memorandum to the Cabinet on the issue.
However, Mr Var adk ar said it would take a “number of weeks” before any plans are even costed. He indicated it would be 2020 before a new pension calculation system is implemented.
“Under the total contributions approach, it will not matter when a person made their contributions. Gaps will not matter,” he said. “What will matter is the number of contributions made over the period of someone’s working life, over the 50 years between the ages of 16 and 66. There will be generous provision to disregard periods of home caring.”
Independent Kerry TD Danny Healy-Rae interrupted to say “many a woman will be dead” before the total contributions system is introduced in 2020.
While the Taoiseach said Government is examining some interim measures, they will not be introduced as part of Budget 2018 as costings have yet to be done. He said costings may not be completed for “quite some time”.
Separately, Independent Tipperary TD Michael Lowry raised concerns around the Strategic Banking Corporation of Ireland, claiming there is “unease about the transparency of the scheme”.
“There is a strongly held view in financial lending circles of favouritism towards the pillar banks and that the conditions of eligibility to the fund are structured in order to suit the big established players in the market — a view that the existing terms and conditions and format are anticompetitive and have a detrimental impact on those lenders which cannot reach the unrealistic and unobtainable criteria set out in the scheme,” said Mr Lowry.
Mr Varadkar said he would discuss matters raised by Mr Lowry with Minister for Finance Paschal Donohoe because he said it is “essential that any public body should operate solely within the legislation passed by this House to provide for it”.
“The Strategic Bank Corporation of Ireland has a mandate to deliver access to finance for Irish enterprises, particularly SMEs, to correct failures in the Irish credit market while encouraging competition,” said Mr Varadkar.