Government to increase PRSI; Pension Commission with recommendation that affects over three lakh people
DUBLIN: The government is planning to increase the PRSI for workers in view of the delay in the scheme to raise the pension age. The move follows the commission’s recommendation to the government to postpone raising the pension age.
It is understood that workers will face continuous PRSI increases in the coming years under the new regulations. It is believed that this proposal will have a negative impact on self-employed people because their contribution will increase by four to 11%. The proposal would adversely affect 3,31,000 such people. It is known that this proposal will not be implemented until 2030.
Commission’s recommendation:
The country’s pension age is currently 66. The Commission recommends that the pension age be increased by three months per year after 2028 (Raising the retirement age to 67 in 2031 and 68 in 2039). The reform package, which focuses on economic sustainability, also recommends increasing PRSI and increasing government allocations.
The Commission also recommends that the PRSI share of the self-employed be increased from 4% to 10% by 2030. There will be no increase for employees or employers until 2030. But the commission says they will have to pay an additional 1.35% by 2040.
The report also recommends that an annual contribution of 10% of the amount spent on pensions be made to the exchequer. The commission was set up to examine the sustainability of the pension system.
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