A Government plan to introduce a flexible pension age has been branded as a "Trojan horse" to increase the pension age by stealth by the leader of Sinn Féin.

Minister for Social Protection Heather Humphreys has confirmed that the State pension age will remain at 66 and people will be offered the choice to work until 70 in return for higher payments.

However, Sinn Féin's Mary Lou McDonald has said people should be allowed to retire at 65.

"You now present a ploy to force people into working until they are 70......this is a scam," she told the Dáil.

Ms McDonald said young workers will look on and wonder if they will ever get to retire at all following today's decision by the Government.

Workers who have "put in their shift and done their bit" should as a matter of principle be allowed to retire at 65 with a decent pension, she said.

The Taoiseach accused the Sinn Féin leader of seeking to stir up people's anxiety by "deliberately not telling the truth" about the new pension plan.

Responding in the Dáil, Micheál Martin said people get anxious when politicians tell bare-faced lies and he accused the Sinn Féin leader of not telling the truth.

He said people would be able to draw down their State pension at 66 in the same way as they do today.

"This Government has decided that people will retire at 66. We are creating choice for people also," he said.

The Taoiseach insisted that Ms McDonald was creating anxiety with "fake news" around the pension age.

"You are deliberately not telling the truth on this one," he said.

The Sinn Féin leader said the source of the anxiety was caused by the Taoiseach and his ilk.

'70 is too old to retire' - opinions from Limerick

The Head of Social Policy and Employment Affairs at the Irish Congress of Trade Unions has said that initial indications are that these are "very positive proposals".

Speaking to RTÉ's Driveitme, Dr Laura Bambrick said: "Based on the press release, and the press release is only a series of bullet points, so we'll have to wait for the details, but the indications are that these are very positive proposals and they're very much in line with long established trade union policy."

When asked if she agreed with Ms McDonald's assertion that it is a 'Trojan horse', Dr Bambrick said: "Not at all, it recognises that more and more of us have more complex and atypical work histories."

'Ambiguities' in proposal - Gannon

Social Democrats Social Protection spokesperson Gary Gannon has said there are "significant ambiguities" in the Government's pension proposal that need to be addressed.

"I welcome the introduction of flexibility in the pension system - with workers being given the option of retiring at 66 or up to the age of 70, with an increased pension entitlement," he said in a statement.

"Workers should not be forced to work beyond the age of 66, particularly those who work in extremely physical jobs in sectors like construction and nursing. Equally, workers should have a choice about continuing to work beyond the current retirement age if they wish.

"However, there are significant ambiguities in the Government’s proposal that need to be clarified – not least the extent of any hole in the Social Insurance Fund (SIF) and the additional cost of providing for choice in the retirement age."

The Fiscal Advisory Council shared its reaction on Twitter, stating: "Keeping the pension age at 66 puts more pressure on the tax system to address shortfalls in funding future pensions.

"While initial increases are modest, this builds to substantial increases that will affect many people currently at work. This may be difficult to implement."

The council warned that "large PRSI increases are likely. A typical worker on €35,000 faces the equivalent of €950 additional yearly taxes by 2040 just to finance the larger numbers of retirees.

"A further €280 increase would be needed to keep the pension age unchanged, rising to +€840 by 2050."