New Lower State Pension - Any Further Details on This.

P

pudds

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Currently a person with an average of 20-47 PRSI contributions per year over their working life receives a weekly State Pension of only €4.50 less
than a person with a yearly average of 48 or more PRSI contributions.

A lower pension will be payable to new applicants for State Pension who
have a yearly average of less than 48 PRSI contributions which better relates to their PRSI record. (September 2012)
Click to expand...
Is there any further details on this and what the proposed lower rate(s) are likely to be.

Current Situation:


48 or over €230.30
20 - 47 €225.80
15 - 19 €172.70
10 - 14 €115.20
 
There's quite a bit of information on the welfare website http://www.welfare.ie/EN/Schemes/Pension/Pages/statepensionchanges.aspx

From the pdf on that page:
If you were born on or after 1 January 1954 the following changes apply;
Once you have paid 520 full-rate contributions (10 years), the minimum State Pension will be payable (i.e. 10/30ths – or one third – of the maximum rate). For each additional complete year of contributions you will gain 1/30th of a pension up to a maximum of 30/30ths. A total of 30 years contributions and/or credits will be required in order to receive the maximum State Pension. The maximum number of credits that can be used in calculating your entitlement to State Pension will be 520 (i.e. 10 years).
If you require additional contributions in order to qualify for a State Pension, you can continue paying full-rate contributions after you reach pension age.
[FONT=Calibri,Calibri][FONT=Calibri,Calibri](Note; State Pension will only be payable from when you have at least 520 full-rate contributions.) [/FONT]

So basically, once you have 10 years contributions, you get the minimum pension (10/30th of the max) and for each extra year you get 1/30th more - up to the max pension. If you take 230.30 as the maximum pension, you would get 76.77 pw once you have at least 10 years of contributions plus an extra 7.67 pw for every extra year of contributions - so 84.44 with 11 years contributions, 92.12 with 12 years,...153.53 with 20 years,... 191.92 with 25 years,... 222.62 with 29 years contributions and 230.30 with 30 or more years of contributions.


It's not necessarily a lower pension for all. There could have been some people with long service (so lots of contributions) but low averages (maybe started the clock running on their average by starting work at an early age) - this new method will make the contributory pension more reflective of contributions.[/FONT]
 
Hi,
This is from *****************. Do not know where they got info from as I could not see any details anywhere else.


Summary of Pension Proposed Pension Changes Sept 2012


Current Proposed Cut
48 or more 230.30 230.30 0

40 to 47 225.80 225.80 0

30-39 225.80 207 €18.80

20-29 225.80 196 €29.80

15-19 €172.70 150 €22.70

10-14 €115.20 €92 €23.20
 
Sending again as figures did not come out as clearly as I thought.

Average no of contributions
now Proposed
48 or more 230.30 230.30
40 to 47 225.80 225.80
30 to 39 225.80 207.00
20 to 29 225.80 196.00
15 to 19 172.70 150.00
10 to 14 115.20 92.00
 
thanks for digging up that info diem http://www.*****************.com/state-pension-cuts-in-budget-2012.html

Good news for anyone like myself who will be an oap in the next 3/4 yrs is that if we have 40-47 average yearly contributions there is no change to how much we get, same as currently, about €4.50 less than full rate.
 
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