IRELAND - Some 64% of the Irish public want pensions to be compulsory, with 47% willing to pay a higher Pay Related Social Insurance rate to provide for them, the Pensions Board has found.
The news comes as the Minister for Social Affairs Séamus Brennan set the Pension Board the task of looking into the issue of mandatory pensions in Ireland.
A spokesperson for the Pensions Board said the 64% statistic was slightly “paradoxical” considering pension coverage in Ireland had been left relatively unchanged at around 50% despite the fact pension awareness within the country had increased to 85%.
Recent OECD figures warned Ireland’s old age dependency ratio will hit 56% by 2050 due to an acceleration in population ageing after 2025 - well above the EU-15 average of 47%.
Anne Maher (pictured), chief executive of the Pension Board chief noted: “The serious issue facing the country is to find a way of ensuring adequate pension provision. This could be done through the current voluntary private system, which would mean more people contributing and in most cases considerably higher levels of contribution, or the introduction of some form of mandatory pension provision requiring everybody to set money aside for their future.”
However not everybody in the industry is convinced pension compulsion is the best way forward.
In a speech at the Irish Association of Pension Funds annual dinner earlier this year, chairman Joe Byrne warned whether employers and employees would be able to cope with the financial burden that will comes with compulsion.
The Pensions Board has until June to complete the review on mandatory pensions.
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