Age Action Ireland Seminar "Older People and Poverty: Past, Present and Future"

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  • Minister Examining Changes to System That Prohibits 80,000 Pensioners Earning More Than €8 Before Benefits are Reduced
  • Brennan Says Older People Are A Valuable Resource & Have A Major Contribution To Make To Society

Age Action Ireland Seminar
"Older People & Poverty: Past, Present & Future "

The Chester Beatty Library
Dublin Castle
Dublin 2
Wednesday 5th October 2005

Opening Address By Seamus Brennan T.D. Minister For Social Affairs

Firstly, I would like to thank Age Action Ireland for inviting me here today to address this very important and timely seminar on older people and poverty.

I would also like to acknowledge and salute the tremendous work the organisation does in improving communication and cooperation among the organisations and individuals concerned with ageing and older people.

Age Action has a valuable input to make in promoting greater interest and research into the needs of older people and the services required to meet those needs and supporting innovative projects and services.

This is Positive Ageing Week and it is an appropriate time for all of us to reflect on how we regard older people. Are we showing them proper recognition and treating them with the dignity they have so richly earned.

Standing as we are in the doorway of the 21st century, it is also a good time to consider how the generations that follow will look back and assess the contribution we have made to the shaping of modern Ireland.

I don't for a moment believe they will base their judgements on how many millionaires, even billionaires, we created out of Ireland's exceptional economic success. I believe that, rightly, they will judge us on how we harnessed the fruits of that Celtic Tiger economic surge to help those most vulnerable in society.

They will also judge us on how we used our new found affluence to properly recognise those whose hard work, sacrifice and vision over many decades laid the foundations for the success we today enjoy.

The young people darting around Dublin today in their BMW's are not the architects of the Celtic Tiger, even if they might like to think so. They are merely standing on the shoulders of the men and women who contributed so much to keep Ireland afloat during the tough times.

That is why there is one message that I take every opportunity to repeat over and over. It is that older people in Ireland are, and will continue to be, a cherished asset and a valuable resource, and I want to see our social policies reflect that.

I am committed to bringing about changes and reforms in the social and welfare areas that best reflect the needs, and aspirations, of our older population in this vibrant 21st century Ireland.

One of the miracles of the modern age has been the rapid improvement in life expectancy. We are all living longer, healthier and more active lives. The number of older people in our society will increase fairly dramatically in the years ahead. By 2011 it is estimated that those aged 65 and over will represent over 14% of our rapidly expanding population.

This longevity is to be welcomed and celebrated, but it must also be acknowledged that it brings with it for the future many challenges and uncertainties.

Of course we recognise that older people have a valuable contribution to make to society and so our biggest challenge will be to provide the supports, services and opportunities that they need to have fulfilment right through their later lives.

To achieve this will require wide-ranging changes and reforms.

I want to see my Department to the forefront in leading the social reforms that are needed, while at the same time maintaining high levels of supports and entitlements.

This year more than €12.2 billion - or €1 in every €3 the State will spend - will go on welfare benefits. And of that €12 billion, almost one third will be channelled directly into pensions and a range of other entitlements and supports for older people.

Since 1997 we have increased pensions by up to €80.26 per week, or 81%. Over the same period the increase in the Consumer Price Index was about 31%, while average earnings increased by 51%.

At the same time we have eased qualifying conditions so that more people can now receive contributory pensions. The Free Schemes and the Medical Card have also been made available to all those over 70 years of age regardless of their income or household composition. We are also well on our way to delivering on the commitment to increase pensions to €200 per week by 2007.

We all want to see people live longer and healthier lives.

It is unacceptable that in 21st century Ireland older people should be living on the poverty line or surviving on incomes that are depressingly inadequate.

Progress is being achieved in this area. The recent eight years have seen a considerable decrease in the proportion of older people experiencing consistent poverty, falling from 8.4% in 1997 to 3.9% in 2001, the last year for which comparable figures are available. The reduction was particularly marked for older women, although they still have a slightly higher risk than men. More recent figures from 2003, though not comparable, still show older people with a lower poverty risk than the population as a whole.

While all of this represents substantial funding and significant progress I believe that more needs to be done in the whole area of pensions reform and other reforms and changes that greatly empower our older population.

Our aim must be to ensure that people retire with a pension which is related to their pre-retirement income so that they can maintain, in so far as is possible, their standard of living and enjoy the retirement they would wish for.

That is why I am anxious to ensure that as many people as possible make arrangements so that they can supplement the social welfare pension when they retire.

Recent research from the ESRI suggested that about a third of older people have an occupational or personal pension. From surveys conducted by the CSO, it appears that those in work have a much better rate of coverage with about 59% of those over 30 years of age contributing to a pension. However, the stark overall facts are that in a workforce of 2 million people, some 900,000 do not have made personal pension arrangements. At the end of the day the aim must be an adequate and decent retirement income for all.

I will shortly receive the Pensions Board report on its statutory review of the pensions industry. I have asked the board to be radical in its thinking and to bring forward innovative proposals so that I can decide, in consultation with my colleagues in Government, how best to implement a pensions system which meets the needs of our older people, now and in the future.

At the same time I am examining what changes can be made in the context of social welfare pensions.

For example, I am currently examining the distinction that exists between contributory and non-contributory pensions. I am not satisfied that it is good social policy to have a system that locks more than 80,000 non-contributory pensioners into a situation that effectively prohibits them earning more than €8, after which point a reduction in the value of their pension starts.

My Department has been examining for some months ways of removing the obstacles to earning extra while at the same time retaining full pension rights. I am also examining the option of allowing those reaching retirement age the choice of continuing to work, if that is what they would like to do. This is not about forcing anyone to work longer. It is about offering people choice and not locking everyone into a 'one-size fits all' regime.

It is interesting that recent research in Ireland has shown that one of the barriers to people continuing to work in their later years were concerns about reductions in pensions and benefits.

As regards incomes, I am examining ways that older people would be given an opportunity to draw down a moderate annual stream of income by, for example, mortgaging part of their property to a State agency.

The other issue of major concern to older people is the whole question of long-term care. Central to that debate is where and how our elderly will be cared for-at home, in the community or in a nursing home environment.

The Working Group on the Long-Term Care issue is now finalising its task of identifying the policy options for a financially sustainable system of long-term care, taking account of the Mercer Report, and the review of the Nursing Home Subvention Scheme by Professor Eamon O'Shea. The Group will report to the Tánaiste and me within weeks.

Carers have also seen increased recognition of their valued role in society through increased allowances, income ceilings and the increase of the Respite Care Grant to €1,000 and its extension to all full time carers, and I am determined to build on that progress over the coming years.

I have also started discussions on how access to technology for older people can be greatly increased. The Internet, mobiles phones and many other devices can transform into valuable communications lifelines for older people.

The issue of an all-island free travel scheme is also moving closer to delivery from meetings North and South at Ministerial and officials level.

Finally, I think most of us probably need to adjust our mindset when it comes to attitudes to retirement and ageing. We must not forget in this fast-paced age that our older people still have a wealth of expertise and experience to pass on to others.

For me, the American poet and free-thinker Oliver Wendell Holmes summed it up best. When he was once asked how he felt about growing old now that he was in his 70's, he replied; "It is better to be 70 years young than 40 years old".

Last modified:14/06/2005