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The state retirement age will not be raised to 67 next January, the Minister of Reform and Public Expenditure, Michael McGrath, confirmed in his budget speech.
“I can confirm to the House that, in line with the Government’s Commitment Program, the planned increase of the retirement age to 67 years on January 1, 2021 will not proceed,” said the minister.
He said that a Pension Commission would be established in accordance with the Government Program and that the Government would consider its eventual report “in due course.”
The latest government announced plans to raise the retirement age to 67 next year and 68 in 2028, but it became a major issue during the general election campaign.
During talks on the government program, Fianna Fáil lobbied to keep the state’s retirement age at 66. Fine Gael resisted this and the parties agreed to defer the issue for a year, pending a report from a newly established pension commission.
At the time, the coalition partners said the commission would report in June 2021, and that any action it recommends will occur within six months of the report’s completion.
Mr. McGrath’s comments on the 2021 Budget do not commit to the timing of any report or its consideration by the government. And he confirmed that no move had yet been made to establish the commission.
‘Unsustainable foot’
In July, the state budget watchdog, the Irish Tax Advisory Council (IFAC) said the current retirement age left public finances “on a vulnerable and unsustainable base” and that it should be pushed out to reflect rising levels. life expectancy.
In its first long-term sustainability report, the watchdog warned that not raising the retirement age as planned in 2021 would cost € 575 million per year, and that figure would increase over time.
Ifac presented a model whereby people would work an additional eight months for each additional year of life expectancy. That would mean extending the retirement age to 69 for the period 2035-2040.
Budget speeches by Mr. McGrath and Finance Minister Paschal Donohoe did not mention the planned introduction of automatic enrollment, in which almost all workers will enroll in private pensions from 2022.
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