NEW RESEARCH ON the sources of incomes of retirees in Ireland has shown that income cirumstances vary considerably – and that more men than women have a supplementary pension.
The report was prepared using data from the first wave of The Irish Longitudinal Study on Ageing (TILDA) at Trinity College Dublin. TILDA is a large-scale study of over 8,500 people aged 50 and over and living in Ireland.
In Ireland, the Pensioner Support Ratio (the ratio of working age people to people 65 and over) is projected to decrease from 5.4 to 1 in 2010 to 2.3 to 1 in 2055, according to Eurostat.
Commenting on the results, Professor Alan Barrett said they show that the income circumstances of Ireland’s retirees vary considerably.
Having a supplementary pension drives a lot of the differences. This should be kept in mind when policy decisions are being made, including decisions on public spending cuts. And for people who are at work, the figures serve as a reminder of the importance of pension saving.
The report shows that the average pension income for retired men is €395 per week, when account is taken of state pensions, other social welfare payments, occupational pensions and private pensions.
However, among the lowest 25 per cent of retired men, average pension earnings is €198. In the top 25 per cent, the average is almost five times that amount, at €938.
Meanwhile, the average pension income of retired women is €254, which is about 2/3 of the income of retired men.
- For lower income retirees, earning €250 and less per week, the state pension makes up about 90 per cent of their pension income.
- For higher income retirees, earning €750 or more per week, supplementary pensions make up about 80 per cent of their pension income.
Having a supplementary pension makes a huge difference to the earnings of Ireland’s retirees, said the researchers,
They found a further gender-based difference: While a half of the male retirees have supplementary pensions, this is the case for only a third of the women.
Former public sector employees of both sexes are about 30 per cent more likely to have such pensions. Having worked in larger firms is also an important determinant of receiving a supplementary pension, as are education and occupation, said the researchers.
After observing the very different levels of reliance on the state pension, the researchers asked:
If the state (contributory and non-contributory) pensions were cut by 10 percent, what would be the impact on those at the lower and higher ends of the retiree pensions distribution?
They say that for those completely reliant on a state pension, the percentage fall in income would simply equal the 10 percent cut. However, for those in the top decile, income would only fall by 1.5 percent.