Phasing in of the Total Contributions Approach for the State Pension

Conan said:
The " existing system " is that you currently get the higher of the two calculation models. But the proposal (not yet law) is from 2024 to gradually move to the TCA. The Minister's answer in the Dail needs to be turned into legislation.
As for women who took career breaks to rear children, they can get up to 1040 credits (equivalent to 20 years).
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Thanks Conan but I still think it is unfair. I also think the non-contributory pension means testing is unfair. I know one career criminal with probably a couple of million stashed in his sock drawer that has drawn the dole for most of his life, is in receipt of HAP and has a medical card that will be entitled to the non-contributory pension when he reaches the age. I believe there should be a guaranteed minimum weekly pension for all.
 
Flybytheseat said:
Thanks Conan but I still think it is unfair. I also think the non-contributory pension means testing is unfair. I know one career criminal with probably a couple of million stashed in his sock drawer that has drawn the dole for most of his life, is in receipt of HAP and has a medical card that will be entitled to the non-contributory pension when he reaches the age. I believe there should be a guaranteed minimum weekly pension for all.
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If that is the case, then here you go.........

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Lisgoold said:
@jimmij
What do you think the figure would be for me? Would be grateful if you could have a go at it.
First paid PRSI Dec 1990.
Reach 66 Dec 2025.
Have 887 contributions, all class A.

Secondly, that 10 year transition to TCA. Is that a definite thing now, or still just a proposal?
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Sorry, I missed this at the time somehow.
Below are my assumptions and subsequent calculations from a by now hazy recall of how it's done.
Assuming that added on to your 887 existing contributions were about another 39 for the year 2023 plus 52 for 2024 plus 52 for 2025 (not sure about all that) that would give you a total of 887 + 143 = 1030 contributions
You started in the year 1990 to 1991 and finish in the year 2025 which is 36 years inclusive.
1030/36 makes for an average of 28.6 contributions per year
Under the averaging method alone this would have given you €246.30, the current full pension of €289.30

Under the total contributions method alone you'd have (1030/2080) * 289.30 = €143.26

In 2025 the split is 90% averaging and 10% total contributions*
So your actual pension should be (0.9 * 246.3) + (0.1* 143.26) = €236
So if I am correct you'll be getting 81.57% of the full contributory pension

AFAIK they seem to have begun implementing the transition a year later than originally planned, ie in 2025 rather than 2024


Applying for the State Pension (Contributory) from 2025

From 1 January 2025, if you apply for the State Pension (Contributory), there is a new way of calculating your rate of payment.
www.citizensinformation.ie www.citizensinformation.ie
 
jimmij said:
Sorry, I missed this at the time somehow.
Below are my assumptions and subsequent calculations from a by now hazy recall of how it's done.
Assuming that added on to your 887 existing contributions were about another 39 for the year 2023 plus 52 for 2024 plus 52 for 2025 (not sure about all that) that would give you a total of 887 + 143 = 1030 contributions
You started in the year 1990 to 1991 and finish in the year 2025 which is 36 years inclusive.
1030/36 makes for an average of 28.6 contributions per year
Under the averaging method alone this would have given you €246.30, the current full pension of €289.30

Under the total contributions method alone you'd have (1030/2080) * 289.30 = €143.26

In 2025 the split is 90% averaging and 10% total contributions*
So your actual pension should be (0.9 * 246.3) + (0.1* 143.26) = €236
So if I am correct you'll be getting 81.57% of the full contributory pension

AFAIK they seem to have begun implementing the transition a year later than originally planned, ie in 2025 rather than 2024


Applying for the State Pension (Contributory) from 2025

From 1 January 2025, if you apply for the State Pension (Contributory), there is a new way of calculating your rate of payment.
www.citizensinformation.ie www.citizensinformation.ie
Click to expand...
Thanks for that!

Sadly though , the 887 is the final figure. It won't increase.
 
Conan said:
An inequity in the current system is that its possible to get a full State Pension with only 10 years service (eg if you emigrated into Ireland at say age 55 and worked for 10 years paying Class A Contributions). Whereas someone else might require 40 years of A to get a full pension.
So a move to the Total Contribution Approach, even on a phased basis, is fair and equitable.
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