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Written Answers. - PRSI Contributions Refund.

Wednesday, 12 June 1996

Dáil Éireann Debate
Vol. 466 No. 7

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 154. Mr. Moynihan Information on Donal Moynihan Zoom on Donal Moynihan  asked the Minister for Social Welfare Information on Prionsias De Rossa Zoom on Prionsias De Rossa  the plans, if any, he has to refund moneys paid after 1988 by way of PRSI contributions by self-employed persons, who, in view of insufficient contributions did not qualify for a contributory pension on reaching retirement age. [12283/96]

Minister for Social Welfare (Proinsias De Rossa): Information on Prionsias De Rossa Zoom on Prionsias De Rossa In order to qualify for an old age contributory pension, a person must have entered insurance at least ten years before pension age. This condition has been a feature of the scheme since it was introduced in 1961, and its objective is to link entitlement to pension with a reasonable level of contributions to the social insurance fund. It applies to all [1931] insured persons, including the self-employed.

All persons who enter social insurance after age 56 are entitled to a refund of the old age pension part of their contributions provided that they are not entitled to or in receipt of an old age non-contributory pension or a pension based partly on these contributions. Accordingly, self-employed people in this category, who became insured for the first time when social insurance was extended to the self-employed in 1988, are normally entitled to a partial refund of contributions.

Where a person has less than ten years self-employment contributions paid, but has earlier insurance as an employed or voluntary contributor for any period before reaching age 56, both forms of contribution may be combined for purposes of assessing entitlement to pension. As these people first entered the social insurance system prior to age 56, they are not entitled to a refund of contributions in the event of failing to qualify for pension.

Also, social insurance contribution paid in an EU member state can be combined with contributions paid here to qualify for an old age contributory pension. Social insurance contributions paid in a country outside the EU, but with which Ireland has a bilateral social-security agreement can be combined with contributions paid here to qualify for a special pension under the agreement. This latter situation arises only when the applicant does not have an underlying entitlement to a pension under existing social security legislation in either State.

The existing legislation governing refunds of contributions has been reviewed recently with particular reference to the position of self-employed persons who were over age 56 in 1988, and whose only previous contributions were prior to 1953 when the unified system of social insurance was first introduced.

As a result, it has been decided that such persons may be entitled to a refund [1932] of the old age pension portion of their self-employment contribution provided they do not qualify for an old age non-contributory pension or a pension based partly on these contributions. On this basis, approximately 400 people will be entitled to refunds which will be made by the end of this year.


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