It looks very much that the Oireachtas Committee has taken the Government off an awkward hook with its recommendation that the qualifying age for the State pension should remain at 66. And Micheál Martin’s comment that the Government will now be keeping ‘an open mind’ on the subject is political-speak for the reality that he has gladly seized the lifebelt thrown to him.
The Oireachtas Committee finding runs counter to that of the earlier Pensions Commission, which advised that it would be necessary to raise the pension age to 67 by 2031 and then, incrementally, to 68 in 2039.
It was a proposal based on sound common sense; with more people living longer, it would be impossible to continue funding the State pension at present levels for very much longer. At present, the ratio of employed to State pensioners is 4.5:1, but in 30 years’ time, that will fall to the unsustainable level of 2:1.
That was the view of the Pensions Committee, taking a detached, cold-eyed assessment of the situation based on economic facts. The Oireachtas Committee on Social Protection, however, is made up of pragmatic politicians who know only too well the consequences of grasping a nettle that is sure to alienate a large section of the population, all the more when that is the section most likely to come out and vote on polling day. So when it comes to kicking the can down the road, as opposed to committing political hari-kari, there was only going to be one answer.
Many of the committee will no doubt have remembered – or if not, would have heard about – those days of grey revolt over a decade ago when the senior citizens of Ireland rose up in anger at a Budget proposal to limit medical card entitlement for the over 70s. Twenty thousand seniors from all over Ireland descended on Dáil Éireann in an outpouring of anger not seen since the foundation of the State.
The day before, in a sort of dress rehearsal, 2,000 had packed St Andrew’s Church, where the Fianna Fáil Minister for State was booed and heckled so angrily that he had to abandon his speech of explanation and retreat back to Leinster House.
It was a revolt that shook the Government; the thunderous roars of ‘Fianna Fáil out’ easily carried into and through the corridors of power. It had the desired effect. After a threatened backbench revolt, resignations and the massive public backlash, Taoiseach Brian Cowen reversed the reform and scrapped the plan to means test the over 70s for medical card entitlement.
That should have been a lesson never to be forgotten, but it seems the penchant of governments for shooting themselves in the foot has no limit.
Just before the most recent budget, the Minister for Finance had come up with an idea to put a tax on loans that parents (the Bank of Mum and Dad) might advance to their offspring to enable the purchase of a new home. It was only at the eleventh hour – and following an avalanche of alarmed complaints to the offices of TDs and senators – that Mr Donohue withdrew the proposed measure. Had it gone through, and the sleeping giant of grey anger was again roused to action, the government would have paid a high price for its cack-handedness.
And so with the pension conundrum. There is no painless solution to finding a way to close the funding gap. But thanks to the Oireachtas Committee on Social Protection, there is no way now that the Government is about to administer the corrective medicine.