Pension mistakes will not be corrected for at least a year

Regina Doherty says a solution will not be found until the next budget at the earliest

It will be at least a year before mistakes in the rules governing the State pension are corrected by Government.

It has emerged that a change in the pensionable age from 65 to 66 will essentially only apply to workers in the private sector.

Public sector workers will be able to dodge the delay in payment if they leave their jobs at the age of 65.

A “supplementary pension” will be given - which won't be available to private sector workers - many of whom may have to retire at 65 and claim Jobseekers Benefit for a year before getting their state pension.

This morning, the Minister for Education Richard Bruton said there is a simple explanation behind the anomaly:

“What you have here is an additional contribution model within the public service for which people pay into and it does give them some additional benefits - and this is one of them,” he said.

“But there is no question that these are benefits for which they are paying extra.”

Time out

The Minister for Social Protection Regina Doherty

Meanwhile, the Social Protection Minister, Regina Doherty has admitted next year's budget may be the earliest opportunity to set right a separate anomaly that means people who took time out of work are getting lower pensions.

At the moment, people who took a career break - largely women who were raising children - are losing out on around €1,500 a year.

On Newstalk Breakfast, Minister Doherty said officials in her department are currently compiling a report to assess the extent of the problem - adding that Cabinet will then decide what actions to take. 

“It will be very easy to find out how much money it would cost to fix it,” she said.

“What won’t be easy is to put in a quick fix that won’t cause another anomaly somewhere else."

She admitted the system as it stands is unfair, but warned that the upcoming Social Welfare Bill does not include the funds to "fix this now." 

"What is wrong is that women and men who worked much shorter periods of their working lives are receiving a larger pension than people who worked much longer periods of their working life," she said. 

"That is unfair and we want to fix it and we are going to fix it - but it will be in the medium term just to be absolutely clear." 

She said the Minister for Finance is the ultimate arbitrator in terms of allocating money with a solution likely to be found during next year’s budget negotiations, “at the very earliest.”