Pensions Reform
Dail Éireann — 2023-05-23
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Heather Humphreys (FG), Cavan-Monaghan

There could be a case where somebody did not pay any PRSI - was self-employed or for whatever reason - who then started paying PRSI ten years before their pension age and then got a full pension. I do not think that is fair. The total contributions approach will do what it says on the tin. A person's pension will be based on the number of contributions he or she paid in. It is going to happen gradually so over a ten-year period, the yearly average approach will be gradually weaned out and that minimises the impact for people.
Existing pensioners will remain as is. It will only happen to new pensioners and will not start until 2025, so it will be 2035 by the time the yearly average approach has been phased out completely. That is 12 years away. At the minute, a pensioner gets whichever is most favourable, whether it is the total contributions or the yearly average. The total contributions approach is fairer. Phasing out the yearly average approach was recommended by the Pensions Commission and, together with increases to PRSI, the measure will help us keep the pension age at 66.

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Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/dail/2023-05-23/debate/main
Retrieved: 2026-08-14T04:51:56+00:00
Sitting date: 2023-05-23