Increase in State pension age to 67 should be delayed by seven years, report to recommend

bkenn14 said:

What i said in respond to clubman in post 128

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Post #128 is from @Annieindublin so, yet again, you're not making much sense.
And you still haven't explained your misattribution here:

bkenn14 said:

my understanding is because of the higher pension the government pay out at 70 they save no money so there is no saving to be had for future pensioners,

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The break even time will be very long for most people who decide to defer up to age 70.

If any of these people die before their late 80's the government will save money.

bkenn14 said:

dont be honing into just the D class,

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You decided to hone in on class D employes.

Message 128 post 130,

I remember there was a thread about the years to break even if you defer taking the COAP.

S class said:

You decided to hone in on class D employes.

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I just pointed out that lots of D stamps along with other who only started paying in late in life will finish up getting away higher PRSI pensions because of the option to keep paying until 70 I have no problem I say good luck to them,

The point i was making was raising the option to pay prsi to 70 years will cost money not save money,

bkenn14 said:

I just pointed out that lots of D stamps along with other who only started paying in late in life will finish up getting away higher PRSI pensions because of the option to keep paying until 70

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Very few pension deferees will get "a way higher Prsi pension".

In general anybody, regardless of when they started to make reckonable paid Prsi contributions, will gain 1/40th of the COAP for every 52 paid contributions.

A few lucky people might manage to get into a higher Averaging band as a result of deferral.

But this can happen regardless of whether they were previously Class D or not.

CharlieMac said:

I remember there was a thread about the years to break even if you defer taking the COAP

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In other words seeing it will take until a 88 for anyone who has enough credits at 66 it only benefits people who haven't enough credits at 66 so it is costing the taxpayers and future pensioners a fortune,not saving money ,

people can dress it up any way the like it was a dumb decision on the government part if the were trying to save on pension cost into the future,

bkenn14 said:

Message 128 post 130,

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?

bkenn14 said:

Message 128

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bkenn14 said:

post 130,

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Makes little sense.

S class said:

The rules of the Irish Prsi system force certain people to make full rate paid contributions which do not give any benefits.

Class K Prsi is charged at the same rate as employee Class A and self employment Class S, but gives absolutely no benefits.

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PRSI class A workers both public and private retiring to day and there employer payed in around one sixth of payroll in other words they contributed away more tax than any other group,

Having said the above what you point out is correct and is what i posted in my first post if the state had a fair PRSI system in place they would not have ran into the problems the did when they tried to raise the pension age

I cant ever see the day it will be fair so raising the pension age will always be resented by Irish people because of the system we have in place,

The same argument will be used again and again unless the first create a level playing field seeing it was not built in at the beginning there is not a chance in hell of getting it sorted now,

The first significant increase iin the Irish State Pension from 65 to 66 was introduced by the Fine Gael-labour coalition government in 2011
with the change taking effect in January 2014 this was part of a phased increase that was intended to eventually reach age by 2028,

The reason for increasing the pension age was to save the taxpayers money,
Look at what happened they did nothing to sort out the workers who had worked for 40/50 years without a break in service where the contract said they must retire at 65 this resulted in having to go on there Unemployment benefit which lasted 9 months,and paid 38 euro less than the contributary pension,

After massive pressure the changed it to twelve months but the debate had already started on how unfair the new pension age was to people
who paid in for 40/50 years without a break in PRSI contributions
now look at what they have done anyone paying in for the first time at 60 in 2011 and started paying PRSI A Stamp for the first time will have a full PRSI pension by 2021 then they change option to 70 years which gives the person paying for 10 years a higher pension,

What people are forgetting is the new rules have increased pressure on the PRSI fund which is funded for the most part out of the the contributions of long term employers and employees contributions, only to see is squandered on silly changes,

bkenn14 said:

PRSI class A workers both public and private retiring to day and there employer payed in around one sixth of payroll in other words they contributed away more tax than any other group,

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The class A employee pays the same percentage rate of Prsi as a class S payer.

Yes their employer pays a large amount extra.

This combined amount of Prsi collected related to class A employment makes the deferral to age 70 even more benefitial for the government.

The lose out age for the government is further increased for a deferred class A employee, because of the extra 4 years of Prsi contributions.

The deferral scheme is a very cleverly thought out plan by the government.

S class said:

The rules of the Irish Prsi system force certain people to make full rate paid contributions which do not give any benefits.

Class K Prsi is charged at the same rate as employee Class A and self employment Class S, but gives absolutely no benefits.

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Yes but class K is very limited I believe, unearned income from rents etc and public office holders that earn above 5000 a year I believe.
They are not going to revolt over withdrawing benefits but still deducting prsi payments.
I'm talking about an average middle class worker with maybe a 500K pension pot, a 500K house and 500K in other assets being potentially denied a state pension even though they worked and paid prsi all their lives because they are above the threshold.

Also they paid for the state pensions of other workers throughout their working lives with some qualifying for a full state pension with as little as a 10 year work contributions. As has already been pointed out the unfairness of the current system by giving some people alot of benefits for relatively few contributions would not be taken lying down when a potential future administration would pretend to forget about all that and try and introduce means testing

S class said:

he class A employee pays the same percentage rate of Prsi as a class S payer.

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That is the wrong way to look at it, If you look you will see in almost every other EU country everyone pays around the same amount of payroll into the social insurance per worker weather they are an employee/ self employed/or whatever other structures are in place,
If you look at any other EU Country if the self employed pay 16%i n total employees pay around 1% more,
If I employed someone in the morning he/she had to earn enough to pay full payroll cost including employers Contribution before they contribute to the business,
In others words once you are an employee you contribute a total of around 14 and a half % PRSI Fund along with USC from payroll before income tax,

S class said:

The rules of the Irish Prsi system force certain people to make full rate paid contributions which do not give any benefits.

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Which is exactly the point i made in my first post
(because the Irish PRSI system has so much known unfairness built into it from the beginning by the Government of the day there is no trust when it comes to reform)
So reform cannot happen until the system is reformed first and seen to be fair to all who pay in,

bkenn14 said:

So reform cannot happen until the system is reformed first

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bkenn14 said:

now look at what they have done anyone paying in for the first time at 60 in 2011 and started paying PRSI A Stamp for the first time will have a full PRSI pension by 2021 then they change option to 70 years which gives the person paying for 10 years a higher pension,

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This is not true. 10 years of A class contributions does not give a “full PRSI pension”. 10 years is the minimum number of contributions you need to get the minimum pension. There are very few people , I suggest, who start paying A class PRSI at age 60. Over the next 10 years the pension calculation is being changed, phasing out the Yearly Average Method and gradually moving to the Total Contribution Approach - 1/40 of a State Pension for each year of contribution.

bkenn14 said:

can draw your PRSI

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You don't have PRSI to draw, it's spent the second you pay it. When you turn 67 or 68 or whatever, you need someone else to pay for you. I'm currently paying for my mother in laws 's pension (along with benefits for many other people).

Clubman
in reply to post 156
Reform of the pension age will be resisted as we already seen until people feel the can trust the system in place to be fair to all,

some people are easily deceived or gullible,but the people who feel/know they have payed away more than others for the same controberty pension
Most people can see a mile away anyone who they can see has no understand of how how PRSI system works in Ireland and have closed there minds to how it works all over the EU,
The first thing the TROIKA did was load USC up on everyone by the same amount and reduced Total Prsi class A on employees to get a bit of fairness into the Irish social system, any bit of reform so far came from Europe ,

bkenn14 said:

Reform of the pension age will be resisted as we already seen until people feel the can trust the system in place,

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Reform of the pension age will be resisted regardless - people that have already paid into a system will feel they should get what they were promised out of it. So the only way to reform it is to set out new promises to incoming participants now based on life expectancy rather than a fixed age - i.e. 2065+ retirees.

Quite frankly, it's ridiculous that we've already kicked the can down the road from 2011/2014/whenever it was, reversed course(-ish!) with BP65, etc.

Make the politically expedient decision today for 40 years hence, and then manage the interim consequences the way we've been doing it since the IMF were in town anyway, i.e. pension increases in the budget below the rate of inflation. Second best time to plant a tree is today and all that!