Changes to State Pension (Contributory) rules

Changes to how the State Pension (Contributory) is calculated have recently been announced by  The Minister for Employment Affairs and Social Protection. The changes aim to ensure that all of a person’s social insurance contributions, rather than when they were paid, are taken into account when assessing their entitlement to a pension.

What are the main changes?

The new Total Contributions Approach (TCA) will include a new HomeCaring credit. This will provide credited contributions for up to 20 years of homemaking and caring duties. The changes will particularly benefit those who spent time outside the paid workplace, while raising families or in caring roles.

Who is affected by these changes?

The TCA will come into effect on 30 March 2018. It will also be available to anyone who reached pension age after 1 September 2012, when the revised rate bands took effect.

The TCA will replace the “yearly average” approach for all new State Pension (contributory) applicants from around 2020 onwards. This approach will ensure that a person’s pension payments reflect more fully and fairly a person’s lifetime contributions history.

The first payments will be made in early 2019, with payment backdated to 30 March 2018.

What do I have to do now?

If you are affected by the changes, the Department of Social Protection will be in touch with you later this year.

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