DSP should be giving accurate pension figures before awarding a persons contributory pension.

S

S class

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It is disgraceful that after introducing the new deferred pension scheme DSP refuse to give accurate detailed pension figures before a person applies for their pension. It is quite difficult to accurately work out your own pension. Especially so in the next 10 years while the averaging system is being phased out.

Once a person applies for their pension it cannot be cancelled if they realise that they are being awarded less than they estimated and would have been better off if they had deferred for a period.

In some cases a deferral period of a few weeks can be the difference between gaining an averaged pension into the next averaging band. The rules relating to how contributions are counted in the averaging method are complex and it is very likely that a lot of people will miscalculate their pension entitlement.

An error which for instance resulted in an average of 14.49 being applied instead of the 14.5 wrongly estimated by the person applying would resultin a loss of 69.90 euro per week in pension.

If this person had been preinformed of their error they could have deferred to 1st of January of the next calender year and probably regain most of the lost 69.90 euro.

At present I am trying to advise a person who will be 7 contributions short of the 14.5 average band at age 66. He is presently short of 23 contributions in order to reach the minimum level of 520 full rate paid contributions in order to qualify for a pension.

The dilemma is that he can postpone getting employment until the start of his pension claim year.
Normally any Prsi contributions gained in this year are not counted. But in the case where they are needed to reach the minimum level of 520 full rate paid contributions, they are counted.

So in effect he can increase his Prsi contributions immediately before he claims his pension.

I know for definite that the extra contributions needed to reach the 520 minimum level will be counted, but I was doubtfull if they would also be counted in the averaging calculation to bring him over average 14.5.

I have emailed this situation to DSP and sought guidance. While they tried to be helpful the answers are vague. They might be counted and there might be an extra year added to his averaging calculation.
Basically they can't give an accurate answer until he applies for his pension. It will then be calculated.

It's a bit like russian roulette if he applies on this basis.

Plan B would be to defer for a full calender year and definitely get into the 15 - 20 averaging band but then lose out on several months of pension payments and also lose out because of an extra years percentage deduction caused by the phasing out of the averaging method.

Irish workers should not be treated in this shoddy manner after working and paying their Prsi contributions.

A service to give accurate calculations before awarding the state contributory pension is overdue.
 
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When you do apply and they tell you the pension will be x, do they show you the workings? Can it be appealed if you believe it to be incorrect.

I get personnel may be stretched and they do not have time to do the complex calculations so that people can see where they stand but with the current complexities in the system a state body should strive to give citizens accurate and up to date information. Otherwise it is a lucky dip, no one to say, work an extra 6 weeks and you will be €70 better off a week or any other sage advice like that.

In the past people had no option but to retire at 65, so you reached a dead stop with prsi contributions and there were no other options. The calculations were terminal and you got what you got. Now there are options and permutations that need planning. It is incompatible on the one hand the government and agencies saying we should plan for the future and on the other not giving you information which you can use to plan for the future.
 
Clamball said:
When you do apply and they tell you the pension will be x, do they show you the workings? Can it be appealed if you believe it to be incorrect.

I get personnel may be stretched and they do not have time to do the complex calculations so that people can see where they stand but with the current complexities in the system a state body should strive to give citizens accurate and up to date information. Otherwise it is a lucky dip, no one to say, work an extra 6 weeks and you will be €70 better off a week or any other sage advice like that.

In the past people had no option but to retire at 65, so you reached a dead stop with prsi contributions and there were no other options. The calculations were terminal and you got what you got. Now there are options and permutations that need planning. It is incompatible on the one hand the government and agencies saying we should plan for the future and on the other not giving you information which you can use to plan for the future.
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Completely agree, spending so much time on possible phantom projected figures and what ifs, but if they don’t abide by the law to provide yearly statements, and they get away with telling you to wait until pension age when it’s possibly too late to become eligible. Trying to fish out 1979 “social insurance stamps” and being told we do not have records prior to April 1979, you may find records by contacting Revenue, not exactly helpful and can’t won’t give details of pre entry credits.
 
Clamball said:
When you do apply and they tell you the pension will be x, do they show you the workings? Can it be appealed if you believe it to be incorrect.

I get personnel may be stretched and they do not have time to do the complex calculations so that people can see where they stand but with the current complexities in the system a state body should strive to give citizens accurate and up to date information. Otherwise it is a lucky dip, no one to say, work an extra 6 weeks and you will be €70 better off a week or any other sage advice like that.

In the past people had no option but to retire at 65, so you reached a dead stop with prsi contributions and there were no other options. The calculations were terminal and you got what you got. Now there are options and permutations that need planning. It is incompatible on the one hand the government and agencies saying we should plan for the future and on the other not giving you information which you can use to plan for the future.
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I was awarded my pension in March 2023. I was very disappointed as I was averaged at 29 ,just short of the next bracket.Several phone calls,emails and request in writing I got a breakdown of how it was calculated in September 23.
As I had a mix of A credits,and Homecaring periods and D credits- I found it hard to work out.
I am still in communication as I was not awarded Homemakers credits,however it does not look hopeful.
I requested a new statement of contributions and notice that I have been awarded 4 years homemaker credits but my reckonable credits have been reduced by 104, which will bring my average to 29 .2,so unfortunately there will be no increase in my weekly payment.However I await confirmation of this from the Pension section,but in my experience it takes about 3 weeks after a decision is made to get notification in writing
 
Fiddlybits said:
I was awarded my pension in March 2023. I was very disappointed as I was averaged at 29 ,just short of the next bracket.Several phone calls,emails and request in writing I got a breakdown of how it was calculated in September 23.
As I had a mix of A credits,and Homecaring periods and D credits- I found it hard to work out.
I am still in communication as I was not awarded Homemakers credits,however it does not look hopeful.
I requested a new statement of contributions and notice that I have been awarded 4 years homemaker credits but my reckonable credits have been reduced by 104, which will bring my average to 29 .2,so unfortunately there will be no increase in my weekly payment.However I await confirmation of this from the Pension section,but in my experience it takes about 3 weeks after a decision is made to get notification in writing
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That is very annoying.

However you would not have had the possibility to defer as this only started in January 2024. So there was nothing you could have done to improve your average calculation.

No consolation, but at least the outcome was not as a result of a last minute Prsi planning mistake on your part.
 
Clamball said:
Can it be appealed if you believe it to be incorrect.
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It can be appealed if you believe the calculation is incorrect.
You have 21 days from the date of your pension decision letter to lodge an appeal.

"The statutory time-limit for submitting an Appeal is within 21 days of this
Decision(i.e. this letter). Failure to submit an appeal in a timely manner may result in
non-acceptance of your appeal. If you wish to seek a review before you appeal, it is
important that you do so as soon as possible."
 
S class said:
It can be appealed if you believe the calculation is incorrect.
You have 21 days from the date of your pension decision letter to lodge an appeal.

"The statutory time-limit for submitting an Appeal is within 21 days of this
Decision(i.e. this letter). Failure to submit an appeal in a timely manner may result in
non-acceptance of your appeal. If you wish to seek a review before you appeal, it is
important that you do so as soon as possible."
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Can I just add to this that in submitting an appeal, it's not necessary to enclose the documentation that forms the body of the appeal within the 21 days. It's just necessary to give the Appeals Office notice that one wants to appeal and the details of the decision that is being appealed. The letter or email can end with a statement to the effect that ".... documentation in support of my appeal will be forwarded to your office as soon as possible."

It's also worth thinking about whether one should ask for a personal hearing; especially if one isn't good at writing letters. It's possible to ask for someone else - a friend or maybe someone from Citizens Information if they are willing to help - to attend the appeal with you and make your case.
 
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Fiddlybits said:
I was awarded my pension in March 2023. I was very disappointed as I was averaged at 29 ,just short of the next bracket.Several phone calls,emails and request in writing I got a breakdown of how it was calculated in September 23.
As I had a mix of A credits,and Homecaring periods and D credits- I found it hard to work out.
I am still in communication as I was not awarded Homemakers credits,however it does not look hopeful.
I requested a new statement of contributions and notice that I have been awarded 4 years homemaker credits but my reckonable credits have been reduced by 104, which will bring my average to 29 .2,so unfortunately there will be no increase in my weekly payment.However I await confirmation of this from the Pension section,but in my experience it takes about 3 weeks after a decision is made to get notification in writing
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Cases like this suggest to me that we should be somehow encouraging people to check their SI record a few times during their lifetimes.
 
Dr Strangelove said:
People should get an annual update with the following:
1) if you stop contributing today your pension would be €X.
2) if you continue contributing until age 66 your pension will be €Y.
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But for most people, going forward from 2035, there will be only one calculation- 1/40th of a State Pension for each year of contributions/credits. And it's possible to get a PRSI record at any time
 
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Conan said:
But for most people, going forward from 2035, there will be only one calculation- 1/40th of a State Pension for each year of contributions/credits. And it's possible to get a PRSI record at any time
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Promising that things will be hunky dory in 11 years' time isn't that reassuring for those of us who are already putting a few bob aside every week towards the cost of our wake.

Furthermore, the PRSI record that one gets doesn't include the many credits that are added on only when pensions are being calculated; and that's one of the main reasons for the dissatisfaction with the current situation.

In the case of my missus, although she has recently - on her own initiative - applied for and received the details of the home makers and home carers credits that she will receive - and which are NOT shown on her PRSI record - she is still unable to obtain clarity on either her PECs or whether or not she'll be eligible for Change of Status credits (and if so, how many will she get?). This leaves her - like many others - in a situation where they simply doesn't know what band they'll be in when, on the cusp of 66 - or 67, or 68, or 69, or 70 - they finally receive the details of their contributory pension from DSP.
 
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Dr Strangelove said:
By who and when?
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Time was somewhere before Covid. It must have been Regina Doherty who came up with the proposal. It was before the Feehily pension commission- which actually picked up some version of it in its final report. Everyone was supposed to get an automatic frequent update with a rough pension forecast after reaching a certain age. I do remember it because the Germans do the same thing- I get this forecast every second year by snail mail from an office in Hamburg.



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There must be more around it because it was discussed in public a few times- like on Prime Time...
 
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What frustrates me is that all the rules around eligibility for State Contributory Pension, while complicated, are black-and-white mathematical rules. I'm not particularly skilled with spreadsheets but even I managed to knock up one in a couple of hours that could work out both the TCA and averages calculations and then look at them for someone who reaches 66 during the transition period to all-TCA from 2025 to 2034 inclusive.

Surely a handful of skilled IT folk in the Department would have no trouble doing something similar for all the relevant rules and adding a report output at the end?
 
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