Increase in State pension age to 67 should be delayed by seven years, report to recommend

The Pensions Commission report, which was submitted to Social Protection Minister Heather Humphreys in recent days, is understood to recommend that the State pension age begin to rise in quarterly increments to 67 between 2028 and 2031, before gradually increasing to 68 by 2039.

The recommendation will be welcomed by the Government which set up the commission, and scrapped plans legislated for by Fine Gael and Labour in 2011 to increase the retirement age from 66 to 67 from 2021 and to 68 in 2028.

The Irish Independent understands the recommendation in the report is that the increase should be done on a phased basis.

This would see the retirement age set at 66 and three months in 2028, 66 and six months in 2029, 66 and nine months in 2030 before hitting 67 in 2031.

The retirement age would then increase by three months every two years in the following decade until it reaches 68 by 2039.

The age at which a person qualifies for the State pension became a major political battleground in last year’s general election after Fianna Fáil promised to postpone the rise to 67, but Fine Gael insisted on it going ahead.

Sinn Féin, meanwhile, pledged to restore the pension age to 65.

The compromise reached under the Programme for Government saw the increase to 67 postponed and the issue referred to a Pensions Commission which was chaired by former Revenue Commissioner chair Josephine Feehily.

It was tasked with examining sustainability and eligibility issues around State pensions and the social insurance fund, in light of Ireland’s ageing population and growing fears about a pensions timebomb.

The Dáíl was told last month that deferring the planned increase this year would cost €221m.

Belgium, Denmark, France and Germany have all adopted policies in recent years of gradually increasing their retirement age over several years, rather than moving in one 12-month block.

Meanwhile, a spokesman for Ms Humphreys said last night: “The Minister has just received the report and, out of respect for her Government colleagues, she will not be commenting on its detail until it is considered by Cabinet.”

The Government had previously been accused of “going too far, too fast” by hiking the age that workers would qualify for the State pension to 68.

In a report in 2019, the Irish Congress of Trade Unions had called on the Government to reverse planned increases in pension age.

While increases in the pension age are taking place in many countries, it said Ireland is currently on course to have the highest pension age in the OECD in 2028.