When news broke that a hugely unpopular pension age increase could be delayed, someone posted a meme of “live scenes at Government Buildings” featuring a man kicking a can down the road.
The draft report of the Commission on Pensions gives the Government the option to kick that can down the road for a decade.
The can in question is the age at which you qualify for the State pension.
When the realisation that this was going to rise to 67 hit home before the last election, the Government incurred the wrath of soon-to-be pensioners. And so, the pension age remained untouched at 66.
A Pensions Commission was set up, with a broad brief.
It was asked to look at the pension age and a host of other imponderables about the troubled system that have perplexed social welfare ministers for years.
If the Government backs the commission’s preferred option to ensure the Social Insurance Fund remains sustainable, the State pension age will not rise to 67 until 2031.
It is likely that a lot of the faces we are familiar with in Dáil Éireann today will no longer be there.
However, no matter what option it goes for, unless it chooses to ignore the co mmis sion altogether, PRSI increases for the self-employed will be due in the near future. This may not go down well with many who are still grappling with the effects of the pandemic.
This draft report must be commended as one of the first to make specific recommendations rather than list loose objectives to deal with the enormous multi-billion euro deficits facing the State pension system.
However, it doesn’t seem to give much thought to imposing the pension age increases that were already planned.
From 2028, the pension age will rise by three months every year. You can’t help but feeling sorry for the Social Protection staff who have to manage it.
The commission notes that the Government may choose to ignore it, but it would still be left with the same problems. The dwindling ratio of workers to pensioners is, of course, a huge factor in the need to deal with the issue.
Another big one is the fact that a low portion of workers have a private pension. They will rely solely on the State pension in old age.
This is one of the main reasons the State pension age, and whether or not there is an extra fiver in the budget, are such political hot potatoes.
Successive governments have been full of promises about setting up an auto-enrolment scheme to help address this.
But there has been an abysmal failure to do so. It has led to an understandable resentment among many in the private sector, whose taxes are funding expensive guaranteed public sector pensions.
It looks like Covid means it will be delayed again. This report gives its backing to its “early introduction”, like so many reports before.
Without this important measure in which workers and employers would contribute, the massive pressure on the State pension system will continue indefinitely.