THE PRSI SYSTEM is being reformed to make it easier for people to take a career break without losing their state pension entitlements.
The reforms, which will make it easier to make voluntary contributions under the PRSI system, will also benefit self-employed people, those who move abroad temporarily and people who take early retirement.
Speaking about the measure, Minister for Social Protection Leo Varadkar said: “At the moment, if you pay into the PRSI system for long enough, you become entitled to certain benefits without having to pass a means-test.
“These include the State Pension Contributory when you reach 66 and the Widows/Survivors Pension for your partner if you die before the age of 66.”
However Varadkar explained how you can lose this entitlement or have it reduced if you leave work and stop paying PRSI for a number of years.
Voluntary contributions allow you to prevent this from happening. I am making it easier to make these voluntary contributions by given people up to five years to decide to do so instead of just one.
He added, “The main beneficiaries will be self-employed people who have a bad year or a few bad years and don’t pay PRSI in those years, people who take early retirement who might otherwise have their state pensions reduced, people who go overseas for a few years and do not pay into an equivalent system, people who retire early due to ill-health, and also parents who decide to stay at home.”
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