The National Pensions Framework Plan Plan was launched in March 2010. This  plan outlines how the Government intends to deal with pensions, both State Pensions and Occupational Pensions into the future.

Some elements of the Plan have already been implemented, but others remain to be implemented.

State Pensions

  • Mandatory social welfare pension coverage will continue.
  • The Government will seek to maintain the rate of benefit at 35% of average weekly earnings.
  • In 2020, the proposal is to simplify the current system and to move to a “total contributions” approach which will replace the current “average system of assessment”.
  • The State Pension Transition, previously payable from age 65, was abolished in 2014.
  • The State Pension now starts at age 66.
  • The State Pension will commence from age 67 in 2021 and move to an age 68 start in 2028.

Proposal on Occupational Pensions

In the case of Occupational Pensions the Government’s Framework announced in 2010 intends to introduce an Auto Enrolment system whereby employees will be automatically enrolled into a new pension scheme unless they are a member of their employer’s scheme and that scheme provides higher contribution levels or is a Defined Benefit scheme. Contributions to the new scheme will be made within a band of earnings, with earnings below and above certain thresholds exempt. Employees will be required to make a fixed percentage contribution. A State contribution equal to 33 per cent tax relief will be provided in respect of pension contributions made by the employee (within a band of earnings). Employers will be obliged to make a contribution equivalent to the State contribution. For example, a contribution of 4 euro to the scheme will comprise an employee contribution of 2 euro, a State contribution of 1 euro and an employer contribution of 1 euro. Access to Approved Retirement Funds will be provided.

The Framework proposes that if individuals decide that retirement savings is not feasible for them, they can opt out, but it also proposes that there will be a once-off bonus payment for individuals who contribute to the scheme for more than 5 years.

This framework proposal is still under consideration by Government, so it is unclear when it might be introduced.

Current Systems in Social Protection

Every aspect of Social Protection is covered by a relevant leaflet. In general the RPC recommends that you contact either the Department of Social Protection directly to ascertain what (if any) benefits or allowances which you are entitled to obtain. This can be done either on-line at www.welfare.ie or alternatively by calling the LoCall Leaflet request line on 1890 20 23 25. The Citizens Information Centres www.citizensinformation.ie also provide advice on all these matters and details of your local office can be obtained on 0761 074000 or email information@citizensinformation.ie

Benefits and Allowances

At the outset it is important to note that while Benefits are not means-tested while, all Allowances are means-tested.

Social Protection Benefits are payments made to you on the basis of money you have paid into the scheme. If unemployed, you may also receive credits – which help build up your entitlements & benefits.

The main benefits relevant to you in retirement are:

The Contributory Pension – payable at 66

The Mixed Rate Pension – see below.

It is advisable that anybody who may qualify for these pensions seek a copy of their pensions record well before retirement. For a copy of your personal record contact the Central Records Office on LoCall 1890 690 690 or go on-line to www.welfare.ie

To get your record you require your PPS Number and Date of Birth.

When you have your record you may take it to either your local Social Welfare Office or your local Citizens Information Centre and ask for assistance in making the calculation of your entitlement.

If you retire early you may also be entitled to Jobseekers Benefit (formerly Unemployment Benefit).

In general what you receive depends on what you have paid in.

While Benefits are not means-tested, Social Assistance Allowances on the other hand are discretionary payments made by the Department on the basis of an examination of your financial situation. They are means-tested.

You are eligible for benefit according to the Class of Social Insurance you are in and the PRSI contribution record you maintain.

There is nothing automatic in the payment of Social Insurance Benefits.  You must fulfil all of the relevant conditions necessary to obtain the benefits, for which you are eligible, and to which you are entitled AND you must apply for them in good time (usually 4-6 months for pensions).

State Pension – Contributory

This pension, which was formerly called the Contributory Old Age Pension, becomes payable at age 66 to Class A and Class S contributors.

This benefit is not means tested but if you do not qualify, an alternative Non-Contributory State Pension, which is means tested, is available.

You do not pay the Universal Social Charge (USC) on this pension.

Further information regarding this benefit may be obtained from Social Welfare booklet SW 118.

Mixed Insurance Pro Rata Pension

If you are a Class B, C or D contributor but have worked in a Class A employment previously, you may be entitled to a mixed Insurance Pro Rata Pension, subject to meeting certain contribution requirements.

The rate of pension is paid in proportion to your total contributions over your full working lifetime.

You do not pay the Universal Social Charge (USC) on this pension.

 

Contributory Widow’s, Widower’s and Surviving Civil Partner’s Pension

This pension is available to Classes A, B, C, D or S and is payable in the event of the death of either spouse/partner.

You do not pay the Universal Social Charge (USC) on this pension.

Further information concerning this benefit may be obtained from Social Welfare booklet SW 25.

 

Qualified Adult Allowance (Means Tested)

This applies where you may be entitled to claim for a dependant.

The would-be Qualified Adult must be financially dependent on you as well as satisfying other conditions.

Further information concerning this may be obtained from Social Welfare booklet SW 11.
 

Working Abroad

If you have worked in another EU Country or in a State with which Ireland has a bilateral agreement, you may receive a pension from both or use the contribution record from each to help qualify for a pension in Ireland.

Ireland has bilateral agreements with the United Kingdom, United States, Switzerland, Canada, Australia and New Zealand.

Contact your local Social Welfare Office or your local Citizens Information Office for any help you require.

Income Tax

With a few minor exceptions, Social Welfare payments are subject to income tax if your total income from all sources is regarded as amounting to a taxable income. If, therefore, you are in receipt of payment, you should inform your tax office so that your tax credits and cut-off point are correct.

Household Benefit Package

This package is normally available to Class A contributors at age 66 and to others at age 70 provided that the qualifying conditions are met. The package is made up of two allowances as follows:

  • Electricity or Gas Allowance
  • Free Television Licence

Further information concerning this package may be obtained from Social Welfare booklet SW 107.

 

Medical Card

A medical card may be obtained by everybody at age 70 on a means tested basis.

The income limits for 2014 are €500 per week for a single person or €900 per week for a couple.

With a few exceptions a means test normally applies before age 70.

With effect from 5/8/2015 everyone aged 70 and over is entitled to a GP Visit Card, regardless of income, provided you are ordinarily resident in Ireland. This GP Visit Card includes home visits and out-of-hours urgent GP care. It does not include the cost of any medicines. You can register for the GP Visit Card at gpvisitcard.ie

 

Free Travel

A free travel pass may be obtained by everybody, on a non means tested basis, at age 66 and a named companion, who may be under age 66, can be included on the card.

Further information concerning this package may be obtained from Social Welfare booklet SW 40.

 

Additional Resources