IRELAND - The minister for social and family affairs Seamus Brennan today confirmed his interest in setting up a mandatory pension scheme in Ireland.
In a speech Brennan asked the newly formed Pensions Board to “build on the work of the National Pensions Review”, published today, which discussed various viable mechanisms including “mandatory and soft mandatory systems.”
The review, which was put together by the previous board, was designed to address reform in the e62m Irish pensions system with particular emphasis on improving figures that show less than 50% of the country’s workforce lack private pension provision.
Brennan said the possibility of reducing benefits or increasing taxation was “very unpalatable” and alluded to the possibility of allowing a more flexible system where people could choose to retire or remain at work past 65.
He said, “I will examine closely the Pensions Board proposal to allow people to defer taking social welfare pension at age 65 in favour of having it increased on an actuarial basis at a later date.”
Brennan said he wished to tap into the “savings habit” which was sparked by the introduction of the Special Savings Incentive Account (SSIA), but his speech suggested he was unlikely to accept an SSIA set-up as a means to address pensions coverage.
As one of its key recommendations the review said incentives should be introduced to encourage the proceeds of SSIA to be saved for retirement and targeted at those who would not otherwise qualify for tax relief or who have not “fully availed of their tax relief entitlement”.
Further qualifying his affection for a soft mandatory system, Brennan said, “International experience suggests that no fully voluntary system will deliver the level of pension cover we must aspire to if all older people are to have dignity and security in retirement.”
The People's Pension, Atlas Master Trust and The Cheviot Trust have been granted authorisation from The Pensions Regulator (TPR), taking the total number of authorised master trusts to 18.
Pension schemes have been warned they may now face a more challenging legal test if they wish to fix drafting errors.
The Greene King Pension Scheme has appointed XPS Pensions as its actuarial and investment adviser following a competitive tender process.
Professional Pensions has compiled a list charting the progress of master trust authorisation. View our list in full here...