Uproar at threat to cut old age pension
O Cuiv refuses to rule out move as part of Budget drive
Published 14/05/2010 | 05:00
THE Government faces a massive 'grey vote' backlash after a senior minister last night refused to rule out cutting or means-testing the old age pension.
Social Welfare Minister Eamon O Cuiv signalled that the Government may target wealthy elderly recipients -- or else cut pension payments across the board.
But groups representing pensioners warned that older people would not stomach any more cuts.
The row erupted after Mr O Cuiv said he could not guarantee that the annual €5bn spent on pensions would not be affected in next year's Budget.
"Looking at the €22bn spend (on social welfare), it is way too early to rule out a quarter of that from consideration," he told the Irish Independent.
After the over-70s medical cards debacle in 2008, the Coalition is wary of going near the so-called grey voters again. Pensioners were spared from social welfare cuts in last December's Budget.
Finance Minister Brian Lenihan has given his Cabinet colleagues until the end of the month to propose ways to cut €3bn in spending.
With up to €2bn to be cut from current spending next year and beyond, it is unlikely that the pension will be spared from the axe indefinitely.
Mr O Cuiv said if the Government had to "go back to the well again" and cut social welfare spending, there would come a point where "it would not be justifiable" to go back and reduce the same payments.
He said there were a lot of people of working age who were under financial pressures due to unemployment and mortgage payments.
"I am not saying we are going to have a means test," he said. "I am not hinting at anything or ruling anything in or out.
"What I am basically saying is that I am looking at €22bn of a spend," he said.
"We have to keep a very open mind on how we make sure we target whatever resources we have on the people who are most in need of the money."
The minister said the first call for resources should be those who were most vulnerable and a lot of elderly people had pointed to the plight of young families with heavy bills.
But Fine Gael social welfare spokesperson Olwyn Enright said the old age pension would "certainly be the last thing I would look at".
She asked: "Why did he start there? Why didn't he look at where other savings could be made? It's very unfair to people to talk about these things and try to look the hero then if they don't do it."
Groups representing the elderly said pensioners were already being hit by a range of cuts and would campaign strongly against any reductions.
Age Action Ireland head of advocacy Eamon Timmins said the minister kept saying there were some people who did not need the State pension.
"What he is hinting at is means-testing. There is a tax system to tax the wealthy. You can't means test the contributory pension," he said.
"The cuts are coming in at an alarming rate. Older people are being attacked from every side. I don't think older people will stomach it," he added.
The Irish Senior Citizens Parliament said more than half of older people were dependent on this pension as their sole source of income.
"The loss of the special payment at Christmas was a reduction in the payments for those pensioners during one of the harshest winters we have experienced," a spokesperson said.
So far this year, the organisation said, a wide range of benefits had been removed and charges had risen. These included reductions in dental and optical benefits and the introduction of the carbon tax.
Active Retirement Ireland chief executive Maureen Kavanagh said the minister's comments would cause "huge concern among retired people, who are already counting the costs of the recession."
She added: "Last year, pensioners had to accept an end to the Christmas bonus. To decrease the pension in the next budget would place unimaginable pressure on older people."