Brennan considers changes to State pensions

The Government is considering allowing retirees to continue to work without affecting their State pensions, the Minister for Social Affairs said today

Seamus Brennan told the Age Action seminar at Dublin Castle marking Positive Ageing Week that older people have a major contribution to make to society and deserve to be treated with dignity.

"Older people in Ireland are, and will continue to be, a cherished asset and a valuable resource, and I want to see our social policies reflect that," Mr Brennan said.

The Government spends around €4 billion each year on pensions and other services for older people. Mr Brennan said the average pension had risen by over 80 per cent since 1997, while average earnings were up by 51 per cent in the same period.

Despite this, Mr Brennan accepted that it was "unacceptable" that older people "should be living on the poverty line or surviving on incomes that are depressingly inadequate." Latest available statistics, produced in 2001, show 3.9 per cent of pensioners were living in consistent poverty. With this in mind, he said the Government was committed to increasing the State pension to over €200 per week by 2007.

The minister also said he is undertaking a review of social welfare pensions.

"I am not satisfied that it is good social policy to have a system that locks more than 80,000 non-contributory pensioners into a situation that effectively prohibits them earning more than €8, after which point a reduction in the value of their pension starts," Mr Brennan said.

He said he wanted to allow people to earn extra money and but retain their full pension rights. He is also examining the option of allowing those reaching retirement age the choice of continuing to work. "This is not about forcing anyone to work longer. It is about offering people choice and not locking everyone into a 'one-size fits all' regime," the minister told the conference.

Current estimates suggest that by 2011, the over-65s will make up 14 per cent of the total population. Latest figures by the Central Statistics Office show 59 per cent of workers over 30 are contributing to a pension. However, some 900,000 do not have personal pensions.

Mr Brennan said he will shortly receive the Pensions Board report on its statutory review of the pensions industry. He will then begin on a strategy to encourage more people to take up pensions to ensure they enjoy a comfortable retirement.

"Our aim must be to ensure that people retire with a pension which is related to their pre-retirement income so that they can maintain, in so far as is possible, their standard of living and enjoy the retirement they would wish for," the minister said.