Pension age should not go beyond 66, Taoiseach says

Micheál Martin says modest PRSI hike may be needed to fund such an approach as decision on 2020 election issue looms

Taoiseach Micheál Martin has told party members that the State pension age should not go beyond 66 and that PRSI increases may be needed over time to fund this.

He made the comments at a Fianna Fáil pre-budget meeting on Friday with the Government due to make a decision on the future pension age in the near future.

A commission established to examine the issue recommended a gradual increase in the coming years after a mooted increase to the pension age became a major theme during the last general election campaign. Sources said TDs Jackie Cahill, Barry Cowen and Senator Ollie Crowe raised the issue of pension age at Friday’s meeting.

Mr Martin is said to have told his TDs and Senators: “My view is the pension age should not go beyond 66 and this may involve some modest increases in PRSI over time.

“People should also be allowed to work on if they wish and continue to pay PRSI so they can qualify for a full pension.

“Flexibility will be key. A fair and sustainable approach will be required to give people certainty.”

Earlier, Minister of Public Expenditure Michael McGrath said one-off measures and supports in areas such as childcare will be part of a budget package designed to help people struggling with the rising cost of living. Speaking ahead the Fianna Fáil budget meeting, he said the key priority was to protect the vulnerable amid rampant inflation.

The Minister told Newstalk Breakfast the approach would involve a series of “significant” one-off measures and providing support for those working families who were feeling “real pressures” by reducing the costs for childcare, housing, health and changing tax structures. He said the third priority was investing in public services and offering greater access to them.

The Summer Economic Statement next week would give a good indication as to the resources available for Budget 2023, Mr McGrath said.

The Minister said the date for the budget would be confirmed next week amid reports it could be moved forward due to the pressure the Coalition is coming under to propose solutions to ease the burden of the surge in living costs. If there was to be a change from the October date, he said, it would be “modest” as planning a budget was a long and complicated process.

Mr McGrath said there needed to be an awareness that there could be “head winds” ahead in the form of the slowing of the global economy, the war in Ukraine and the resurgence in Covid-19 cases.

Tánaiste Leo Varadkar on Thursday said that Ireland could be grappling with the cost-of-living crisis for years. He said the spike in global inflation would not end “because of any budget, whether it’s an emergency budget before the autumn or whether it’s one in the autumn”.

Meanwhile, Mr McGrath said he was hopeful an agreement can be reached in public service pay talks this month. However, he warned the Government had limited resources and that any accord had to be fair and affordable.

Trade unions have told the Workplace Relations Commission (WRC) the Government’s latest offer of a 5 per cent pay increase over two years for public servants is “not credible”.

Kevin Callinan of the Irish Congress of Trade Unions (Ictu) had earlier told RTÉ's Morning Ireland that Mr McGrath should instruct officials from his department to return to talks at the WRC in an attempt to reach an agreement.

Jennifer Bray

Jennifer Bray

Jennifer Bray is a Political Correspondent with The Irish Times

Cormac McQuinn

Cormac McQuinn

Cormac McQuinn is a Political Correspondent at The Irish Times