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Any changes to pension age or PRSI will be ‘gradual’, finance minister Paschal Donohoe says


Finance Minister Paschal Donohoe. Photo: Niall Carson

Finance Minister Paschal Donohoe. Photo: Niall Carson

Finance Minister Paschal Donohoe. Photo: Niall Carson

Any changes to the State pension age or PRSI will be “gradual”, according to the minister for finance.

Paschal Donohoe was speaking after social protection minister Heather Humphreys said yesterday that the Government will make a decision on increasing the pension age in a number of months.

Despite expectation that a decision on the Pensions Commission recommendations would be reached before the summer, it is now likely to be a number of months before a formal decision is made.

“Any decision that we make in relation to the sustainability of the social insurance system, where we are with the sustainability of our pensions will be gradual changes but they will be changes that will be going in a clear direction,” said Mr Donohoe.

Taoiseach Micheál Martin told the Fianna Fáil parliamentary party last Friday that the pension age should not increase beyond 66 and said he is instead in favour of small PRSI increases.

“We are talking here about a number of months, this is a decision that is going to impact on people for the next 40, 50 years,” said Minister Humphreys.

“It is better that we take a few extra months and get it right.”

The Pensions Commission has recommended the pension age should rise to 67, but not for another number of years.

The state pension age is currently 66. The commission has recommended that this rise by three months a year after 2028, reaching 67 in 2031, before increasing to 68 in 2039.

It said this could be achieved in part by increasing PRSI contributions from 4pc to 11pc for self-employed workers.

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However, earlier this year the Joint Oireachtas Social Protection Committee came down in favour of the qualifying age remaining at 66.

Fianna Fáil TDs and senators lobbied their party leader heavily in recent months for the age to stay at 66 after it became a key issue for the party in the 2020 general election.

However, Fine Gael took a view during the 2020 general election that the pension age should be more flexible, with the payment increasing by €25, including new payments for those retiring at 65 and 66.

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