Windfall for pensioners hit by ‘bonkers’ anomaly over time away from workforce
TENS of thousands of older people are to receive a significant boost to their pension payment from next week, when a “bonkers” anomaly in the system will finally be ended.
The pensioners, who are primarily women, are currently being penalised because they took time out of the workforce at some stage in their career.
It is estimated changes that have now been signed into law by Social Protection Minister Regina Doherty will be worth around €35 a week to some pensioners.
The issue arose as a result of changes made by the previous government, which saw people who reached pension age on or after September 1, 2012 awarded a reduced pension if they did not have an average of 20 social protection contributions throughout their working life.
Thousands of women who left the workforce before 1994 to care for children were hit, as were others who took a summer job or part-time work for a while.
Advocacy groups said those affected have been losing more than €1,500 a year.
Under the new regulations, there will be a small windfall for some pensioners who will be entitled to claim arrears dating back to last March.
The Department of Employment Affairs and Social Protection is currently examining the pension payments of approximately 90,000 pensioners.
Many of these will now be able to receive the full contributory State pension as a result of a provision that allows for “homecaring periods”.
In a statement, the Department said it would issue the first payments next week, but it would take a number of months to process all of the recipients.
“I am delighted to report that all of the necessary legislative and system changes have now been made to allow these reviews to conclude, and I am delighted to sign the necessary regulations to allow the increased payments to start being made shortly,” Ms Doherty said.
“These new measures will benefit many pensioners, and even where pension rates do not increase, I want to assure everyone that no pensioner will be worse off as a result of this review.
“Even though there are tens of thousands of reviews to be conducted, the Department is committed to doing this as speedily as possible for all the pensioners involved, and has recruited approximately 120 additional staff to carry out the necessary work.”
Controversy over the anomaly engulfed the debate around the budget in October 2017.
During a radio interview, Finance Minister Paschal Donohoe admitted the situation was “bonkers and unbelievable”.
He was reacting to a caller to the ‘Today With Sean O’Rourke’ show, whose wife was losing money due to the change. Eamon Tynan, a pensioner from Co Longford, said the situation was costing her €35 a week in her pension payments.
He said his wife had a summer job in the 1960s when she was a secondary school student, before joining the civil service.