Contributory pension. Mixed contribution hsitory.

Claw Hammer · 29-01-2020 02:05PM #1

If you have a mixed contribution history are you stuck with pro-rata even if the full cons on their own would lead to a higher pension. e.g contribution history of 50 years i.e entered social insurance on 16th birthday to age 66. 1200 full and 1200 modified.

On pro rata it would be half pension but on full only it would be an average of 24 per year leading to a reduced pension which would be more than half the full one.

Does the contributor get the benefit of whichever is the higher or is it pro-rata the whole way?

Dodge · 29-01-2020 02:40PM

Claw Hammer wrote: »

If you have a mixed contribution history are you stuck with pro-rata even if the full cons on their own would lead to a higher pension. e.g contribution history of 50 years i.e entered social insurance on 16th birthday to age 66. 1200 full and 1200 modified.

On pro rata it would be half pension but on full only it would be an average of 24 per year leading to a reduced pension which would be more than half the full one.

Does the contributor get the benefit of whichever is the higher or is it pro-rata the whole way?

You’ll get whichever is more beneficial to you. In this case it’d be your average of 24

Claw Hammer · 29-01-2020 04:59PM

Dodge wrote: »

You’ll get whichever is more beneficial to you. In this case it’d be your average of 24

interesting. Is that set out in the legislation somewhere? It is mind boggling trying to follow it.

Dodge · 29-01-2020 05:18PM

The calculations are in legislation but I doubt the principle of paying someone the higher rate is set down (nor needs to be)

Its a fairly established principle though

Claw Hammer · 30-01-2020 04:30PM

Dodge wrote: »

The calculations are in legislation but I doubt the principle of paying someone the higher rate is set down (nor needs to be)

Its a fairly established principle though

It is a well established principle that nobody can be paid from public funds with provision for it in legislation. It is well established that where a person is entitled to two things in the alternative the legislation will be drafted so as to give them the more beneficial. No civil servant can write a cheque without provision in legislation for the payment.

Dodge · 30-01-2020 10:53PM

Claw Hammer wrote: »

It is a well established principle that nobody can be paid from public funds with provision for it in legislation. It is well established that where a person is entitled to two things in the alternative the legislation will be drafted so as to give them the more beneficial. No civil servant can write a cheque without provision in legislation for the payment.

So don’t apply for it then.

You can either take the advice, and see what happens, or believe what I’ve told you happens is wrong

Or to put it another way, if you can find any legislation to say you won’t be paid the higher rate, please post it

Claw Hammer · 31-01-2020 02:33PM

Dodge wrote: »

So don’t apply for it then.

You can either take the advice, and see what happens, or believe what I’ve told you happens is wrong

Or to put it another way, if you can find any legislation to say you won’t be paid the higher rate, please post it

I have found legislation which shows that there may be an even higher rate than you are saying. You are offering advice without expertise and cannot back up your assertions. It appears that if the full cons were made as a self employed person the date of entry is the date the self employment commenced with the result that the full 48 full cons average condition would be met if the self employment commenced after the modified cons were paid.

I am not applying for anything, I am simply trying to work out what is happening and if there is any anomaly which might help of hinder me. Call it forward planning.

Your first contribution in this thread was misleading and your demand that I take your "advice" is ridiculous.
If someone is to be paid public money their entitlement must be set out in legislation.

muffler · 31-01-2020 03:37PM

I'm not sure why you asked the question when you appear to know the answer

Dodge · 31-01-2020 04:11PM

Claw Hammer wrote: »

I have found legislation which shows that there may be an even higher rate than you are saying. You are offering advice without expertise and cannot back up your assertions. It appears that if the full cons were made as a self employed person the date of entry is the date the self employment commenced with the result that the full 48 full cons average condition would be met if the self employment commenced after the modified cons were paid.

I am not applying for anything, I am simply trying to work out what is happening and if there is any anomaly which might help of hinder me. Call it forward planning.

Your first contribution in this thread was misleading and your demand that I take your "advice" is ridiculous.
If someone is to be paid public money their entitlement must be set out in legislation.

Nothing I have told you is incorrect based on what you gave us in your opening post.

You mightn’t believe I have expertise, but at no stage did I give your any incorrect information (based on what you told us)

I’ll ask you once again to point to any legislation that states definitively that you will be paid at the higher rate OR the lower rate.

You can’t, because it doesn’t exist.

I only replied, with the correct information, to help you and to answer your query.

Claw Hammer · 31-01-2020 06:29PM

Dodge wrote: »

Nothing I have told you is incorrect based on what you gave us in your opening post.

Lets look at what you said.
"You’ll get whichever is more beneficial to you."
You have produced no source for this. You may be right but if you make an assertion you should be able to back it up with a source.
"In this case it’d be your average of 24"
This may or may not be correct and is most likely not correct. You have obviously divided 1200 by 50 to get 24, however a lot depends on the date of entry. If the 1200 were self employed contributions paid immediately porior to reaching the age of 66 there could be an average of 52. There may also be grounds to disregard some of the period when no contributions were paid which would distort the average even if te date of entry was 50 years before te last contribution.

"The calculations are in legislation but I doubt the principle of paying someone the higher rate is set down (nor needs to be)"
I don't doubt the calcuations are in legislation but the rest is nonsense. In general there will be a saver to ensure that someone gets the higher if they are qualified.
Nobody can be paid unless they have a right to it in legislation and if someone qualifies in two ways the legislation must specify which is to apply.

Dodge wrote: »

You mightn’t believe I have expertise, but at no stage did I give your any incorrect information (based on what you told us)

I certainly don't believe you have expertise and you information is misleading if it can be called information at all.

Dodge wrote: »

I’ll ask you once again to point to any legislation that states definitively that you will be paid at the higher rate OR the lower rate.

You can’t, because it doesn’t exist.

I don't know who you can assert no legislation exists unless you can say you have read and are familiar with all social welfare legislation as it concerns the Contributory pension. Based on your answers and your ignorance of section 20 of the Consolidated Social Welfare Act i doubt you are familiar with and social welfare legislation

Dodge wrote: »

I only replied, with the correct information, to help you and to answer your query.

No you didn't. You made an assertion which you can't stand over and which is incomplete. you are saying "trust me, I know". You cannot be relied on in this situation.

Claw Hammer · 31-01-2020 06:36PM

muffler wrote: »

I'm not sure why you asked the question when you appear to know the answer

I asked the question to find the answer. The legislation is labyrinthine. Since I got no useful information other than pub expert level contributions I have had to continue to research it. I had hoped someone might have been through the process and could point to a published decision or a section of the Act where the position is made clear or else show the process working.
I am slightly more wiser but far from reassured at this stage. people pulling things out of their ass and stating it as fact and then challenging me to contradict them is not what I expected.
I ask a question.
Someone makes something up and makes an obviously wrong comment.
I challenge them.
Now I am expected to prove them wrong citing legislation when they have never cited any?

splinter65 · 31-01-2020 07:23PM

Claw Hammer wrote: »

I have found legislation which shows that there may be an even higher rate than you are saying. You are offering advice without expertise and cannot back up your assertions. It appears that if the full cons were made as a self employed person the date of entry is the date the self employment commenced with the result that the full 48 full cons average condition would be met if the self employment commenced after the modified cons were paid.

I am not applying for anything, I am simply trying to work out what is happening and if there is any anomaly which might help of hinder me. Call it forward planning.

Your first contribution in this thread was misleading and your demand that I take your "advice" is ridiculous.
If someone is to be paid public money their entitlement must be set out in legislation.

Why did you make the query if you didn’t need any advise?

Dodge · 31-01-2020 08:21PM

Claw Hammer wrote: »

i doubt you are familiar with and social welfare legislation

I am.

You made an assertion which you can't stand over and which is incomplete. you are saying "trust me, I know". You cannot be relied on in this situation.

I do stand over my comments, and everything I’ve said in this forum.

You have asked where it is in legislation and I told you it is not in legislation. I have told you what the practice is.

That you choose not to believe me, and think that I ‘can not’ be relied upon is fine with me.

I’ll just point out that what you’re looking for (legislation to say which of the pension rates you’ll be paid at) doesn’t exist.

What does exist is DEASP operating guidelines. They publish some of them online. Here’s the contributory pension one. You’ll see notes relating to other pensions and lines like ‘if it is to their advantage’. There’s a note on overlapping payments but it isn’t online

https://www.gov.ie/en/publication/4f38a6-operational-guidelines-state-pension-contributory/#payment-rates-structure

Now once again, I’ll point out that you asked a question initially and I answered it. If you’re not happy with the answers strangers on the internet give you, seek professional advice instead

In this case, they’ll tell you the same thing

muffler · 31-01-2020 09:04PM

Claw Hammer wrote: »

people pulling things out of their ass and stating it as fact

I think that's uncalled for.

Contact this person and they will be in a position to answer your query. Be quick though.

Claw Hammer · 04-02-2020 04:10PM

splinter65 wrote: »

Why did you make the query if you didn’t need any advise?

I do need advice. The third condition for claiming State Pension (Contributory) is that there are an average of 48 contributions paid. What the guidance documents say is that modified contributions can be used to satisfy the third condition. They don't want to say that the payment is at the pro rata rate. This is seemingly contradicted by the fact that reduced rate pension is allowed where there are fewer than 48 contributions on average. This I have yet to find anywhere in the guidance documents for the underlying legislation that it says that an applicant gets the higher of the reduced rate or the pro rata pension.
While it is a general proposition that where a person qualifies into different ways for payment that person gets the benefit of the one which is most beneficial to him or her, mistakes in drafting legislation can occur and the saving provision may not been inserted.

Nothing I have seen on this thread so far gives me any satisfactory answer.
A further variation comes if the modified contributions are succeeded by self-employment. In that case it is possible that the average could be above 48 because the date of entry is taken to be the day the self-employment commenced. This gives potentially three outcomes in the scenario that I originally posted. Pro- rata, reduced rate and full rate.

It is obvious I am not going to get a properly reasoned answer here.

Dodge · 04-02-2020 04:43PM

Claw Hammer wrote: »

I do need advice. The third condition for claiming State Pension (Contributory) is that there are an average of 48 contributions paid.

The condition needed for the SPC is an average of 10 (and since you need 520 to qualify, the average of 10 will always be reached)

For the full rate you need an average of 48 (or since Sep 2012 a total of 2080).

It is obvious I am not going to get a properly reasoned answer here.

You might get more reasons if you give all the information or you could ask the Department directly with that info instead

splinter65 · 04-02-2020 06:58PM

Claw Hammer wrote: »

I do need advice. The third condition for claiming State Pension (Contributory) is that there are an average of 48 contributions paid. What the guidance documents say is that modified contributions can be used to satisfy the third condition. They don't want to say that the payment is at the pro rata rate. This is seemingly contradicted by the fact that reduced rate pension is allowed where there are fewer than 48 contributions on average. This I have yet to find anywhere in the guidance documents for the underlying legislation that it says that an applicant gets the higher of the reduced rate or the pro rata pension.
While it is a general proposition that where a person qualifies into different ways for payment that person gets the benefit of the one which is most beneficial to him or her, mistakes in drafting legislation can occur and the saving provision may not been inserted.

Nothing I have seen on this thread so far gives me any satisfactory answer.
A further variation comes if the modified contributions are succeeded by self-employment. In that case it is possible that the average could be above 48 because the date of entry is taken to be the day the self-employment commenced. This gives potentially three outcomes in the scenario that I originally posted. Pro- rata, reduced rate and full rate.

It is obvious I am not going to get a properly reasoned answer here.

But here is only a place where people are kind enough to speak from experience or give their opinion based on what they’ve read or heard. Nobody ever claimed to be speaking from a place of authority here.
If you want the absolutely irrefutable nailed on facts about pension legislation then I would advise you to make an appointment to speak to a SW inspector at your local SW office or write to pensions in Sligo because to be as blunt with you as you would appear to be yourself your attitude to posters here tying to be helpful is appalling.
See how you get on with the inspector and you might let us know what he/she said.

Claw Hammer · 04-02-2020 07:09PM

splinter65 wrote: »

But here is only a place where people are kind enough to speak from experience or give their opinion based on what they’ve read or heard. Nobody ever claimed to be speaking from a place of authority here.
If you want the absolutely irrefutable nailed on facts about pension legislation then I would advise you to make an appointment to speak to a SW inspector at your local SW office or write to pensions in Sligo because to be as blunt with you as you would appear to be yourself your attitude to posters here tying to be helpful is appalling.
See how you get on with the inspector and you might let us know what he/she said.

People either know or they don't know. I am not interested in conjecture or taking someone's word for something and acting on it.

Claw Hammer · 04-02-2020 07:16PM

Dodge wrote: »

The condition needed for the SPC is an average of 10 (and since you need 520 to qualify, the average of 10 will always be reached)

According to the Social Welfare Consolidation Act:-

Conditions for receipt.
109.—(1) The contribution conditions for old age (contributory) pension State pension
(contributory) are—
710 Substituted by s.13 SW&PA 2007 711 Substituted by s.13 SW&PA 2007 712 Ss. (9) inserted by s. 9 SWLR&PA 2006
(a) subject to subsection (3), that the claimant has entered into insurance before
attaining the age of 56 years,
(b) that the claimant has qualifying contributions in respect of not less than 156
contribution weeks since his or her entry into insurance, and 713
(b) that the claimant—
(i) has qualifying contributions in respect of at least 520 contribution weeks,
or
(ii) in the case of a person who on or before 6 April 1997, is a voluntary
contributor paying contributions under Chapter 4 of Part 2, has an aggregate of
qualifying contributions and voluntary contributions in respect of 520
contribution weeks, of which not less than 156 are qualifying contributions, or
(iii) in any other case, has an aggregate of qualifying contributions and
voluntary contributions in respect of 520 contribution weeks of which not less
than 260 are qualifying contributions,
since his or her entry into insurance,
(c) that the claimant has a yearly average or, in the case of a person who attains
pensionable age on or after 6 April 1992, an alternative yearly average of not less than
48.

Where are you getting 10? The legislation says 48.

Dodge · 04-02-2020 07:48PM

You need to read the rest of section 109 (Betterregularion would have the most clear and up to date version) and the associated SIs if you fully want to be clear on this

The alternative yearly average can be applied and you must have a yearly average of 48 for that to be available. Only certain classes of PRSI are reckonable (such as A and S but not B and D). There is no lower rate of pay available for this

So to ensure you have a full rate (under YA or AYA) you need an average of 48

If you have less than 48, you will be paid a lower rate.

Dodge · 04-02-2020 07:56PM

As it stands now to *QUALIFY* for the State Pension (Contributory), a person needs
(1) be 66
(2) have 520 paid SI contributions
(3) have made the first of them before their 56th birthday

That’s all.

The modified mixed rate pension and the EU mixed rate allow some others without 520 qualify by using their class B, D contribution or their contributions paid in other EU contributions to get them to that 520 requirement. However they’ll be paid for the Irish reckonable cons proportion

What you’re asking about is the rate of pay, which has a variety of other factors (and the legislation is there if you really want to read it)

muffler · 04-02-2020 10:39PM

Dodge, I wouldnt bother explaining any further as he knows more than anyone else posting here and is "not interested in conjecture or taking someone's word for something and acting on it"

splinter65 · 04-02-2020 10:54PM

muffler wrote: »

Dodge, I wouldnt bother explaining any further as he knows more than anyone else posting here and is "not interested in conjecture or taking someone's word for something and acting on it"

Has totally misunderstood the function of this forum in any case and imo needs to reread the forum rules.

Claw Hammer · 05-02-2020 05:24PM

Dodge wrote: »

You need to read the rest of section 109 (Betterregularion would have the most clear and up to date version) and the associated SIs if you fully want to be clear on this

The alternative yearly average can be applied and you must have a yearly average of 48 for that to be available. Only certain classes of PRSI are reckonable (such as A and S but not B and D). There is no lower rate of pay available for this

So to ensure you have a full rate (under YA or AYA) you need an average of 48

If you have less than 48, you will be paid a lower rate.

The modified contribution classes of B, C and D are not reckonable in calculating the third condition. However, if there are S class contributions the date of entry is the date the first S class contribution was paid. In that case even if there were decades of modified contributions, if self employment started before the age of 56 and 10 years cons were paid the average would be 52 and a full rate pension would apply.

What Section 109 says that regulations may be made by which a person who does not have an average of 48 may be paid a reduced rate.
The applicable regulation as far as I can see is S.I. No. 142 of 2007. That provides for varying classes of reduced rates. A person with a mixed contribution history may qualify for a reduced rate pension on their qualifying contributions alone. The date of entry is critical in calculating the average as is the ability to disregard some contribution years.

A person is only entitled to a pro rata pension if they do not qualify for a full rate or reduced rate pension. Given that if a person could achieve a pro rata pension above the lowest rate of reduced pension, they would have been given a reduced rate pension in the first place, it automatically means that a person gets the better of the pro rata or reduced rate pension. That was my original query.
I am quite surprised to find that someone with a lot of modified contributions might end up with a full rate pension.

Dodge · 05-02-2020 06:12PM

No one with ‘a lot’ of modified cons will receive a full rate pension.

Remember that S rate cons were only introduced in 1988 so the 1979 cut off won’t matter to them

The very definition of a mixed rate pension means they’ll only receive payment for the reckonable cons (and if you already have 520 reckonable cons, then you won’t qualify for it anyway)

Claw Hammer · 06-02-2020 04:57PM

Dodge wrote: »

No one with ‘a lot’ of modified cons will receive a full rate pension.

Remember that S rate cons were only introduced in 1988 so the 1979 cut off won’t matter to them

The very definition of a mixed rate pension means they’ll only receive payment for the reckonable cons (and if you already have 520 reckonable cons, then you won’t qualify for it anyway)

Someone could easily have 1600 modified cons before reaching 56. If they then become self employed, their date of entry will be the date of the first class S con, and if they make at least 520 class S cons, they may have an annual average above 48, hence full pension.

Dodge · 06-02-2020 05:37PM

Claw Hammer wrote: »

Someone could easily have 1600 modified cons before reaching 56. If they then become self employed, their date of entry will be the date of the first class S con, and if they make at least 520 class S cons, they may have an annual average above 48, hence full pension.

Again, that isn’t strictly true. If you first reckonable con was before April 1991, then your ‘date of entry’ is that date

However if your first reckonable con is after April 1991, then the date of entry is the first time you paid ANY SI (including modified rates)

So in your example their 520 would be divided by 40 (or more if they entered into the system before that)

So for any new or future pensioners, your scenario doesn’t happen

Dodge · 06-02-2020 05:51PM

BTW this rule was changed because it’s exactly what was happening

Gardai and firemen would retire at 50/55 on full occupational pension. Then work 15-10 years in the private sector and claim the full state pension after that

Obviously can’t happen for a load of reasons but the first loophole to close was the ‘date of entry’ in 1991

Claw Hammer · 06-02-2020 06:13PM

Dodge wrote: »

BTW this rule was changed because it’s exactly what was happening

Gardai and firemen would retire at 50/55 on full occupational pension. Then work 15-10 years in the private sector and claim the full state pension after that

Obviously can’t happen for a load of reasons but the first loophole to close was the ‘date of entry’ in 1991

It doesn't appear to have changed for the self employed.

Contributory pension. Mixed contribution hsitory.

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