Is Regina Doherty hinting that contributory pensions might be lowered if the person doesn't need them?

Brendan Burgess

Brendan Burgess

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All State pensions should not be equal, says Minister

It is not “fair” that some older people receive State pensions that are more than they need while others on the same amount live in poverty, Minister for Social Protection Regina Doherty has said.

This struck me as odd.

If someone has a non-contributory pension, it is means tested, so they are not getting more than they need.

If it's a contributory pension, they are getting it based on their contributions, and not based on need.

“So a long conversation will be needed,” she said, adding that the changes would not be achieved in one budget cycle.

I suspect that this long conversation will result in the means testing of contributory pensions.

And if a FG minister is talking like this, what would a future left-wing minister do?

Brendan
 
Either the comments are muddled, or the reporting, or both. It's very hard to make sense of the story.

Older people are generally not at risk of poverty because of the NC state pension.
 
Sure why bother working if the state is just going to equalise all outcomes and at the end of the day whether you worked hard, paid your taxes, weren't a burden on the state the likes of Regina Doherty swoops in and takes what you put it to give to someone else.
 
Ireland is very unusual in having a very small difference between the means-tested minimum pension, and full contributory pension. There is less than a 5% difference between them.

There are big equity issues in my view.
 
It’s a dangerous and worrying narrative. A number of years ago, the 4% PRSI contributions only applied to earnings up to a certain amount (€75k at the end). Then it became uncapped. These people that Ms Doherty (of Ballymun) refers to are probably funding their State Pension and 10 other people’s.
 
Surely she cannot be serious - why pay to a private pension if you are going to loose the state benefit you have paid into all your working life. There should be a bigger difference between contributory and non contributory and that should be clear for all to see. It's a dangerous route for Fine Gael to take - pensioners vote and will punish them.
 
The cynic in me is reading this another way. This is not a play for helping those most in need, this a play to drive people into contributing to their own private pensions. Would I be correct in saying that Ireland has a low percentage (less than 50%) of people with private pensions?
I suspect that the carrot will be that differential between the contributory pension plus private pension against the means tested non-contributory will be such that more people will start contributing to their own private pensions.
So the State will appear to be acting fair and protecting those most in need, but in reality it will be compelling people to contribute more to their own pensions.
 
It's the first step of a long, long trek to deal with the unsustainable pension costs coming along in 10, 20 years
Classic stuff, soften everyone up, then go back but it will come back in another year or two
 
The SPC can't be means-tested, can it?

Could we have a means-tested contributory pension?

And a means-tested non-con pension?

I don't think so.
 
Hi Sarenco
There is nothing in that report from thejournal but this is what the Irish Times said

It is not “fair” that some older people receive State pensions that are more than they need while others on the same amount live in poverty, Minister for Social Protection Regina Doherty has said.

How could she reduce the pension for those that already have "more than they need"?

Unless she is suggesting cutting pensions and increasing other social welfare.

Brendan
 
Brendan Burgess said:
It is not “fair” that some older people receive State pensions that are more than they need while others on the same amount live in poverty, Minister for Social Protection Regina Doherty has said.
Click to expand...
Hi Brendan

The above appears to me to be a (somewhat mischievous IMO) editorialised version of what the Minister actually said - otherwise the IT would have given us the full quote.

What the Minister actually said was that she wasn't necessarily in favour of across-the-board increases to social welfare payments (which FF have been pushing), as opposed to more targeted measures to alleviate identified needs. I personally wouldn't have a problem with that approach.

There nothing in what the Minister actually said that would suggest that there is any proposal to abolish the State (Contributory) pension.
 
Hi Sarenco

Where can I find the text of what she actually said?

It seems odd that the Irish Times would misquote her so much!

Brendan
 
Here is what she actually said on Newstalk.

www.newstalk.com

Pensioners want close to an extra tenner a week increase in this years budget | Newstalk

€9 extra every week – that’s how much Age Action and a number of other groups have said t...
www.newstalk.com www.newstalk.com

It's hard to follow.

On the one hand she does mention that people who work should expect to have a good pension in retirement.

But most of it is about giving money to people who need it which is a very different criterion to paying out a pension based on insurance contributions paid in.

Brendan
 
Are there actually loads of pensioners in poverty? A quick check at the CSO https://www.cso.ie/multiquicktables/quickTables.aspx?id=sia12_sia20 shows for 2017 that 1.7% of over 65 are in consistent poverty, the lowest for any age group category, and that this figure has been decreasing in recent years and that 1.5% of those retired from employment are in consistent poverty, the second lowest figure. While unfortunate for the individuals concerned, there is nothing in these figures to suggest that this is a major problem.

Furthermore, the EC's 2018 Pension Adequacy report http://ceoma.org/wp-content/uploads/2018/05/PAR_Volume_II_draft_edited-COM.pdf states that “Social transfers in Ireland are effective in preventing older people falling into poverty in their retirement. State pensions are strongly redistributive due to the flat-rate payments and earnings-related contributions.” and that “Social transfers are particularly effective in Ireland in preventing poverty in retirement. “. So according to the EC, the current system is reasonably effective in preventing poverty among retirees. So is this really an issue?

The most objectional thing the Minister has come out with is that “It is not “fair” that some older people receive State pensions that are more than they need”. It is just wrong and incompatible with a free society that the state should decide what are an individuals needs and should tailor pension payments accordingly. By any standard it's not 'fair' to apply, in effect, a 100% marginal tax rate on part of a pension, because the state arbitrarily decides the pensioner “doesn't need it”.
 
@PMU

Exactly.

The NC pension rate is calibrated very carefully so that the vast majority of pensioners do not fall into the statistical category of being at risk of poverty.
 
Brendan Burgess said:
Here is what she actually said on Newstalk.

https://www.newstalk.com/podcasts/h...close-extra-tenner-week-increase-years-budget
Click to expand...
Thanks Brendan.

I've listened to that interview in full and I didn't hear any suggestion that the Minister wants to abolish the State (Contributory) pension.
PMU said:
The most objectional thing the Minister has come out with is that “It is not “fair” that some older people receive State pensions that are more than they need”.
Click to expand...
Except the Minister didn't actually say that - you added your own quotation marks.
 
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