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Dáil
‹ Leaders' Questions

State pension anomalies

Summary

Deputy McDonald raised protests over pension discrimination affecting about 40,000 people, especially women, and called for full restoration rather than a partial fix. Minister Bruton said the issue is complex, budget-limited, and under review, which McDonald took as effectively a refusal.

People who are being discriminated against under the current State pension provisions will protest outside Leinster House again this afternoon. The Minister is probably aware that this issue affects approximately 40,000 citizens who are campaigning for the full restoration of their pension entitlements. They want a full rather than a partial solution. Some of them are out of pocket to the tune of €30 a week as a result of the changes introduced in 2012. As the Minister knows, this discrimination disproportionately affects women and is a direct result of measures introduced by Fine Gael and its Labour Party partners when they were in government in 2012. Deputy Joan Burton's changes have made it extremely difficult for women who exited the workforce, perhaps to raise children or attend to other caring duties, before returning to employment later in life to qualify for the maximum payment. I cite women as an example because they are affected disproportionately, but I am conscious that the changes also hurt some men. This discrimination did not happen by accident. It was not an oversight or a mistake. The Government of the day made the changes in the full knowledge of the impact they would have on these citizens and the disproportionate effect it would have on women.

Sinn Féin has been calling on the Government for some time to sort out this matter. A motion we proposed in the Dáil in December 2016 to address this injustice was rejected by Fine Gael and Fianna Fáil. The alternative budget we published in October 2017 showed the Government how funding could be provided to rectify and correct this discrimination, but, again, it was rejected by the Government. We raised this matter during Leaders' Questions on a number of occasions before Christmas. Every time we have proposed solutions to this problem we have received evasive and non-committal responses from the Government. Time and again, it has chosen not to do right by the people affected.

It has emerged that the Government is now considering partial restoration. I understand the Minister for Employment Affairs and Social Protection, Deputy Regina Doherty, has acknowledged that the citizens mentioned have been wronged and vowed to fix this anomaly. However, she has expressed the view that something magical will have to happen if the money is to be found. I remind the House that the Government infamously conjured up €5 million to fund a strategic communications unit as the Taoiseach's vanity project. It was able to find enough financial space to introduce tax cuts which disproportionately benefited the well off. Now it is telling us that financial wizardry would be required to find €70 million to correct an injustice perpetrated against 40,000 people. The people who will protest at the gates of Leinster House today are telling us loudly and clearly that they will not accept being treated as second-class citizens any longer. The Government's job is to find a solution for them. Comforting words and expressions of sympathy are not enough because a solution is needed. Will the Minister tell the people standing at the gates of Leinster House that the Government will provide the €70 million in funding needed to enable them finally to receive their full entitlements?

Comment on this

I thank the Deputy for raising this issue. I am aware that the removal of the anomalies in the pensions system is of acute concern. It is also a difficult task. As the Deputy knows, a disregard for home caring was introduced in 1994. Many people who opted out of the workforce in the years before 1994 have been severely affected by averaging. The averaging system is an embedded part of the way we calculate whether people have made sufficient contributions to receive full pensions. It is embedded in the system. The Minister for Employment Affairs and Social Protection is committed to introducing a total contributions approach as a long-term solution. It will overcome the anomaly whereby some people who have made the same number of contributions as others are treated less fairly because their contributions are averaged over a longer period with a gap somewhere in between. Such anomalies will be removed by the long-term solution proposed. As the Deputy said, the Minister is examining various short-term options, on which she will report to the Cabinet in due course. I understand a report on the issue has been put together and will be brought before a Cabinet committee.

When we are making any change in the pensions area, we must ensure it will be sustainable in the long term and not create additional unfairness or new anomalies elsewhere. We also have to ensure it can be funded on a sustainable basis. Such requirements have to be teased out by any responsible Government to ensure the changes made in response to a set of challenges - I recognise that there are challenges in this regard - are sustainable and will not create further unfairness elsewhere. The Government will take time and care to ensure that when we are addressing these problems, we will not create problems further down the road for others. This issue will be carefully assessed by it. We will look at the cost implications and the equity of anything proposed.

Comment on this

I thank the Minister for that answer. I do not for one second deny the complexities involved in pensions policy, provision and reform. I am not challenging that, but the Minister needs to understand the absolute simplicity of the case being made by those who are gathering at the gates of Leinster House. The simple fact is that the changes introduced when Fine Gael was in government in 2012 are costing approximately 40,000 citizens as much as €30 a week in some cases. That is a lot of money for people on limited incomes.

Deputy Brady informs me that the paper of which the Minister spoke will be presented to a Cabinet committee today and is due before the full Cabinet next Tuesday. Will the Government provide the €70 million required to correct this matter? I would like a straight "Yes" or "No" answer to that question. I ask the Minister not to hide behind other anomalies or quirks in the system that need to be dealt with or use them as an excuse for not doing right by the people concerned. The Government must show us the money to make this right.

Comment on this

As the Deputy knows, the budget for 2018 has been agreed and I do not have €70 million in my pocket, nor does the Minister for Finance for that matter. We must consider all changes in this area in a balanced manner. The Deputy recognised the complexity of the issue. If one makes a change in one area, one can create anomalies elsewhere. Under the old system, people who had paid approximately 40% of contributions received the same pension as people who had paid 95% of contributions. It featured anomalies and we must ensure any reform we introduce or contemplate introducing in another budget is thought through, is fair to all those involved and does not create new anomalies elsewhere in the system. The Minister's approach has been to bring to Cabinet a detailed report that fully examines the potential knock-on effects of any change in order that a decision can be made on any future changes with the full information available.

As I stated, it is the Government's ambition that we move to a total contribution scheme, which would be much more equitable and fair to people who are affected. We continue to have the non-contributory pension as a safety net for all pensioners.

Comment on this

I will take the Minister's reply as a "No".

Comment on this