Up to 35,000 farmers face a cut of up to €40 per week to their State pension, under changes to how pensions are calculated.

Farmers and all self-employed contractors and tradespeople born between 1955 and 1960 could lose between €8.20 and €37.20 per week off their pension.

This is due to a new total contributions approach (TCA) planned for post-2020 pensioners.

Under this scheme, 40 years of PRSI contributions are needed to qualify for the maximum pension rate of €248.30/week.

PRSI Class S for self-employed people was only introduced in April 1988. Farmers who reach pension age between 2021 and 2027 could not have the required 40 years of PRSI paid. Farmers born between 1955 and 1960 would receive reduced rates of pension, with the older age group being worst affected.

Minister for Employment Affairs and Social Protection Regina Doherty said the pension reform would be implemented in quarter three of 2020, subject to legislation and supporting structures being put in place.

PRSI consultant Brendan Casey warned that the new legislation would have to be adapted to cater for self-employed people such as farmers, pointing out that the current average test system has a major concession for those who commenced paying self-employed PRSI in 1988.

However, if there are no concessions made for self-employed people under the new TCA calculation, farmers born in 1954 face a cut of almost 15% or €40 to the maximum rate of pension of €248.30/week.

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