Survey finds many on State Pension can't afford basic standard of living

Almost 60 per cent of pensioners surveyed recently said that the State Pension does not go far enough to allow them enjoy the standard of living they would like with many unable to afford a basic standard of living. 

Members of Active Retirement Associations around the country have given their views on what it is like to be living on the State pension, through a nationwide survey conducted by Active Retirement Ireland, the country’s largest membership organisation for older people.

The consultation has found that 58% of those surveyed feel the State pension is not enough to allow them to participate in life as much as they would like, despite the increase of €12 a week to the pension in last year’s Budget.

A total of 437 members from Active Retirement Associations from every county in the Republic of Ireland took part in the consultation in March and April 2023. Respondents were aged 55+, with the majority of respondents (55%) aged 70–79.

When asked what impact the additional €12 a week had made for them, 39% felt that the increase was not enough to allow them to cover their expenses and take the pressure off, while 29% said they still cannot afford a basic standard of living. More than half (55%) of respondents said they are worried about the future and what will happen to them.

Active Retirement Ireland, which carried out the survey in March and April this year, said the findings paint a bleak picture of what it is like to be living on the State pension in Ireland, with the organisation calling on the Government to benchmark the State pension at 34% of average earnings.

CEO of Active Retirement Ireland, Maureen Kavanagh, said: “Budget 2024 is an opportunity for the Government to end pension poverty and deliver their promise of an adequate pension linked to inflation and wage growth.

“Small, ad-hoc amount increases added to the State pension here and there on Budget Day must stop once and for all. The State pension is losing buying power every year and currently sits at just 28% of average earnings. The Government themselves have said the minimum pension rate for basic pension adequacy is 34% of average earnings.

“Pension adequacy and income security should not be too much for older people to expect — these are the people who have worked all their lives and given of themselves to help build the strong economy we have today, and they are the generations who paid the highest taxes and the highest interest rates.

“To now be shut out of the benefits of that economy and live in such financial hardship is just not good enough. We know from the CSO’s Survey on Income and Living Conditions (SILC) 2022, published in February this year, that one-in-five people aged 65 and older are at risk of poverty in Ireland, increasing to one-in-three for older people who are living alone,” Ms Kavanagh said.

The Active Retirement Ireland members’ consultation further found that 90% of respondents would like to see a State pension of at least 34% of the average median wage and that 94% of respondents agree that the pension rate should rise in line with inflation and wage growth.

In June of this year, the Pension Promise Campaign — of which Active Retirement Ireland is a member — launched, calling on the Government to honour its commitment to a State pension of 34% of average earnings. First proposed 25 years ago in 1998, the Government made this commitment in the ‘Roadmap for Pension Reform 2018–2023’ and the ‘Roadmap for Social Inclusion 2020–2025’.

Ms Kavanagh said: “The pension promise is now more important than ever. The Government must honour its commitment of a pension rate of 34% of average earnings and begin the process of providing a secure, liveable income for older people. 

“Active Retirement Ireland has long advocated for this and we have again made this recommendation to Government in our pre-Budget submission this year. Pension adequacy is long overdue and it makes sense, socially and economically.  

“Not only will pension adequacy restore dignity, security and quality of life to older people, but money in pensioners’ pockets is returned through spending in the local economy — older people’s spending is worth €13 million in Ireland.” 

The Pension Promise Campaign is led by SIPTU and includes Active Retirement Ireland, Age Action, the Irish Senior Citizen’s Parliament and the National Women’s Council.

The State pension rate equated to 32% of average earnings in 2021, falling to 30% in 2022 and currently sits at 28% of average earnings.

Active Retirement Ireland is the national representative body for over 500 Active Retirement Associations throughout Ireland.