Irish govt conforms state pension age will not rise to 67 in January 2021

The Irish government has confirmed that the state pension age will not increase to 67 in January 2021.

In a statement as part of the Irish Budget 2021, Minister for Public Expenditure and Reform, Michael McGrath, a TD in Fianna Fáil, confirmed the change from the previous government’s plans.

“I can confirm to the house that, in line with the Programme for Government commitment, the planned increase in the pension age to 67 on January 1st 2021 will not proceed,” he stated.

Instead, he said a Pensions Commission will be established and the government will consider the commission’s report “in due course”.

Currently, the state pension age in Ireland is 66 but the last government had planned to increase this to 67 in January, and then to 68 in 2028. However, the issue of the state pension age was a key part within the most recent General Election in February.

Following the election, a coalition government formed of Fianna Fáil, Fine Gail and the Green Party. Within its Programme for Government the government said it would “make affordable changes to protect not only those approaching pension age but also future generations”.

The state pension will remain the “bedrock” if the Irish pension system but it will also introduce an auto-enrolment system for occupational pensions, as planned by the previous government.

“Taking account of the exceptional strain both employers and employees are now under, we will seek to deliver gradually an automatic enrolment scheme based on the following principles: Matching contributions will be made by both workers and employers and the state will top up contributions.

“There will be a phased roll-out over a decade of the contribution made by workers. There will be an opt-out provision for those who choose to opt out. Workers will have a range of retirement savings products to choose from. There will be a charges cap imposed on pension providers,” the programme stated.

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