Eligibility for State Pension: 25 years in public sector now in private sector.

[putsch]

I've tried to do research on this but my brain got scrambled - maybe some of you experts might be able to help

I worked c.25 years in the public sector and retired on an early retirement scheme from which I have a small pension. I'm now working in the private sector and paying full rate PRSI - am under 55 so could have over 10 years of full rate stamp by the time I'm 65. From my reading of the data I think if I have over 10 years I would get full state pension on retirement. My question is what if I don't work until 65 - will my public sector and private sector contributions be used to calculate eligibility and then the amount pro rated to my years done in private sector. e.g. if I do 5 years in private sector I will get 50% of state pension? That what I gleaned from reading the online info but its so complicated I'd v much appreciate a confirmation from someone who knows.

thanks

 

[Protocol]

Re: Eligibility for State Pension

3 basic conditions to get a state pension. You need to:

• Have paid social insurance contributions before a certain age
• Have a certain number of social insurance contributions paid and
• Have a certain average number over the years since you first started to pay.

(1) Paid insurance before a certain age

You must have entered social insurance before a certain age. For people currently under 66, they must have started to pay social insurance before the age of 56. The age limit is higher for people born before 1922.


(2) Number of paid contributions

If you reach pension age on or after April 6 2012, you will need to have 520 paid contributions (10 years paid contributions). In this case, not more than 260 of the 520 contributions may be voluntary contributions. However, if you were a voluntary contributor on or before April 6 1997 and you have a yearly average of 10 contributions, you may meet the requirement if you have a total of 520 contributions, but only 156 need to be compulsory paid contributions.

(3) Average number contributions per year

You must meet the average condition. This is probably the most complex aspect of qualifying for a State Pension (Contributory).

Normal average rule

The normal average rule states that you must have a yearly average of at least 10 appropriate contributions paid or credited from the year you first entered insurance or from 1953, whichever is later. An average of 10 entitles you to a minimum pension; you need an average of 48 to get the maximum pension.

Alternative average rule

This alternative average only applies to people who reach pension age on or after 6 April 1992.
It requires that you have an average of 48 Class A, E, F, G, H, N or S contributions (paid or credited ) for each contribution year from April 1979 to the April before your 66th birthday. This average would entitle you to the maximum pension. There is no provision for a reduced pension when this alternative average is used.
So, if you reach the age of 66 on or after April 6 1992, your average will be looked at in two ways - the usual average will be assessed and the alternative average will be assessed. Most employed or formerly employed people will be able to meet the alternative average. The alternative average will probably be looked at first because it is easier to assess. If you do not have an average of 48 contributions from 1979 then the usual method of assessing the average will be looked at and you may get a reduced pension (if you do not meet the alternative average, it is virtually impossible for you to have an average of 48 using the normal average rule).

 

[Willowchase]

Re: Eligibility for State Pension

Hello Protocol,

Would appreciate the benefit of your experience.
I was 'retired' 2 years ago at the age of 58. I have been signing on for credits. At this stage and in the current climate it appears that I will not be involved again in gainful employment. Will it be necessary to sign for credits for the next 5 years in order to retain my pension entitlement? Had worked for 39 years prior to this without break.

 

[guitarchris]

What does Average Contribution Mean?

RE. State Pensions, can anyone explain the average rule of "appropriate" contributions. If you have a mixture of D and A as I have (full and modified) is it that you have to have an average of full A PRSI stamps or just an average including D for each year? I have 3 years in the middle as full D stamps and the rest of my career (in private sector) as A. Thank you

 

[gipimann]

If you have public sector and private sector contributions, the assessment for State Contributory Pension is calculated as follows (taken from SW website):

You must have:

• At least 260 paid contributions at the full rate since entry into insurance or 1953, whichever is later
• A mixture of full and modified contributions, which when added together give you a yearly average of 10 (for the State Pension Contributory) from the time you first entered insurance or 1953, whichever is later, to the end of the contribution year before your 66th birthday.
• Failed to qualify for a pension under EU regulations or under reciprocal arrangements with other countries or only qualified for a pension at a lower rate than this pro-rata pension would give you.

If you meet all these requirements, you may qualify for a pension proportionate to the number of contributions that you have at the full rate. To take a very simple example, if you worked for 40 years up to age 66 and 10 of those were in the private sector, you would get one-quarter of the normal pension.
If you reach pension age on or after 6 April 6 2012, you will need to have a total of at least 520 full and mixed contributions paid and at least 260 of these must be full contributions.
What happens to people with mixed insurance is that all contributions at the full and modified rates are added together. The average is then measured in the normal way. If you have an average of at least 10 then you may qualify. Then the number of full contributions is divided by the total number of contributions to find out what proportion are full rate; you then get that proportion of the pension.