State pension benchmarking
Deputy Collins pressed the Government to honour pension reform commitments and benchmark the State pension against earnings. The Taoiseach said there will be another increase in budget 2024, but he would check the exact commitments and stressed the role of broader supports such as fuel allowance and one-off payments.
Last week, Age Action, the Irish Senior Citizens Parliament, Active Retirement Ireland and the trade union SIPTU, launched their pension promise campaign. The campaign is to hold the Government to account on the promises made in the pension reform policy, A Roadmap for Pensions Reform 2018-2023. The policy states the State pension should be indexed at 34% of average earnings and tied to the consumer price index on average earnings. That commitment would put our State pension at €310 per week, which is €45 more than it is now.
Before the last budget, there was a call from groups such as Age Action, the Disability Federation of Ireland, Threshold, Irish Rural Link, Barnardos and the Society of St. Vincent de Paul to increase welfare payments by a minimum of €20 a week. This was explicitly called for not as an increase but to allow people to stand still during the cost-of-living crisis. Instead, the Government gave a below-inflation €12 a week increase. Age Action called this: "a political choice to cut the living standards of older people". It was, and not just for older people but anyone who relies on a fixed income from the State, a political choice made by the Government to make the people who are least able to deal with the cost-of-living crisis poorer.
Over the past two years, there was a sharp decline in living standards for many in this country. We have seen poverty rates and homelessness go up. More people have to choose between food and energy and more people are in utility and mortgage arrears. The Government has not just overseen a massive step back in the quality of people's lives but has voted for it. It is its policy. Last year, the number of older people at risk of poverty increased by 55,000 compared with 2021. Consistent poverty among older persons rose by a third. Enforced deprivation among older persons rose by more than a half. One in three older persons living alone is at risk of poverty. It was up to one in five in 2021. In addition, many older people are now facing notices to quit following the lifting of the eviction ban.
This is not acceptable, not for our older people and not for one of the wealthiest countries in the world. It is far past time to see the increases in the State pension that were promised in 2018 and that we indexed our social welfare rates to a minimum standard of life that allows proper quality of life, which would mean no person relying on a fixed State income needs to live through the harm of another cost-of-living crisis. Does the Taoiseach stand by that promise made in 2018, when he was previously Taoiseach, to increase the State pension to 34% of average earnings? Will he support the pension promise campaign?
Comment on this
I can absolutely assure the Deputy of one thing: there will be a further increase in the weekly pension. That will be in the budget. The exact amount has not been decided yet. That will have to be discussed between now and October and will have to be seen in the round with other things the Government wants to do. There will certainly be another pension increase. A decision on that will be made at budget time, as it always is.
I would have to read back on what was said in 2018 and what is in the programme for Government from 2020. I am not exactly sure that we made a commitment to benchmarking or indexation.
Comment on this
I will have to double-check that but it might not be the case. Obviously, it is the programme for Government from 2020 that applies now and not things from previously.
Comment on this
There is a difference between something being proposed by a Minister or Department and an actual Government decision or commitment. Again, I will come back to the Deputy on that.
The Deputy made some fair points in her remarks but it was only one side of the story. She mentioned the €12 increase in the weekly pension payment, which came into effect in January, but she did not mention the expansion of the fuel allowance to 70,000 lower income people who are pensioners, which has helped a lot of pensioners to get the fuel allowance who did not get it before, or the series of one-off payments ranging from the energy credit, to double pension payments, to the €200 payment a few weeks ago. When they are taken in the round, and if the Deputy is being fair, she should take them in the round, income has kept up with inflation or is at least close to it. If the Deputy is being fair and accurate, she must also acknowledge those increases. She cannot focus on the weekly increase and ignore every other increase. She would not do so if it was the other way around so she might want to expand on that in her further reply.
She is correct that poverty rates among pensioners and older people increased last year. largely as a result of the cost-of-living crisis and the high inflation everyone has experienced. However, she did not acknowledge that pensioner poverty is lower than poverty among working-age people. Pensioners or older people are less likely to experience poverty than adults of working age. It is important to acknowledge that. While poverty rates increased last year due to the cost-of-living crisis, they had been falling and trending downwards for many years. I believe that with incomes recovering, prices stabilising and the actions the Government will take in the next budget, we will see it improve again.
Comment on this
It was A Roadmap for Pensions Reform 2018-2023. It is now 2023 and we are going into the next budget, for 2024. The policy states the State pension should be indexed at 34% of average earnings and be tied to the consumer price index and average earnings. As I said, the commitment would put our State pension at €310 per week. The increase of €12 per week that was given in the previous budget was below the cost-of-living rate. It was below the €20 figure that many of the organisations and NGOs which represent people, such as Age Action and the National Disability Authority, put forward clearly. They said the Government made a political choice to cut the living standards of older people. A weekly income is more important than one-off payments. People base their annual bills, shopping, clothing, medicine costs and all things older people need on their weekly income. Will the Taoiseach check that out and confirm what the Government confirmed in its policy in 2018 and implement the 34% of average earnings index in budget 2024 or before?
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I will. That sounds like a roadmap for reform as opposed to a Government decision, but I will not get technical about the differences.
Comment on this
It is a policy the Government committed to.
Comment on this
I will check it out and come back to the Deputy about it. When we assess things such as payments as a percentage of median income, we do not only take into account weekly payments. We also take into account supplementary payments such as the fuel allowance and other payments. Total income is not only what people get every week. It is the total income over the course of the year.
Comment on this
It is what people depend on every week. It is like a wage and people depend on a wage.
Comment on this
We would certainly include everything in any benchmarking exercise. What have we done already? We increased the weekly pension rate by €12, expanded the fuel allowance to approximately 70,000 more pensioners, gave a €600 energy credit to every household and made one-off payments last autumn, at Christmas and in spring this year. That is a lot and we will do more in the context of budget 2024.