Speed of pension eligibility changes ‘is not desirable’

A senior official at the Department of Social Protection has admitted the speed of changes made to age limits for eligibility to the State pension was “not desirable”.

Orlaigh Quinn, assistant secretary at the department, has acknowledged changes had been introduced very quickly in recent years.

However, she justified the action taken because of the economic recession and the need to make savings.

Ms Quinn said the changes were necessary because of concern about the sustainability of the State pension giving demographic changes that have resulted in more people reaching pension age and living longer.

The eligibility age for receiving the State pension increased from 65 years to 66 years on January 1. It will increase to 67 years in 2021, and to 68 years in 2028.

She told the Oireachtas Committee on Education and Social Protection that pensions accounted for 30% of all social welfare payments, with 100,000 extra claimants since 2008. The committee heard pensioners would account for 23% of the population by 2050, compared to 12% in 2012.

Ms Quinn explained that life expectancy for males will rise from the current level of 82 years to 84.1 years by 2030. The life expectancy for females will increase from 85 years to 87.4 years over the same period.

She said the numbers claiming the Transitional State Pension was relatively small in recent years despite fears there would be a large number of people who had to retire at 65 years but who would have to wait a further 12 months before claiming the Contributory State Pension. Just over 12,000 claimed the transition pension in 2012, of which only 12% had been in work.

Ms Quinn said such figures indicated many workers were leaving employment in advance of their eligibility for a state pension. She claimed the effective retirement age in Ireland was actually 63.3 years.

Martin Shanagher of the Department of Jobs, Enterprise and Innovation, said Government policy was directed towards encouraging longer working lives.

He stressed there is no statutory retirement age in legislation with no restrictions on employers to allow employees work beyond the usual retirement age of 65.

However, the changes to eligibility were sharply criticised by the Irish Congress of Trade Unions.

Ictu representative Fergus Whelan claimed they had been introduced without any consultation or cost-benefit analysis. “They are depriving people of benefits earned and paid for.”

He claimed the Government had provided no advice to employers on whether they should “retain or dump” workers who had reached 65 years.


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