IRELAND - Irish Social and Family Affairs minister Seamus Brennan today outlined the problems facing the Irish pensions industry.
In his speech at Irish Association of Pension Funds' annual conference in Dublin today, Brennan said that the Irish pension industry faces an "increasingly serious" situation.
"The increased life expectancy throws up new challenges," due to which the government will need to focus more on long term solutions, Brennan argued.
"Today's generation needs to put something away for its own retirement: we need to encourage and ensure that all workers get a supplementary pension scheme and are not completely reliant on the state pension."
Also Brennan spoke of a mandatory or quasi-mandatory Irish pension system: "I'm not saying we should go there, I'm saying it would be neglectful of us not to look at all options."
Furthermore, Brennan called for a development of the special savings incentive accounts (SSIAs) in pensions. He said: "We should also give serious consideration to the Pensions Board's proposal that we tap into the success of the SSIA scheme and build up a savings habit that has been created."
He argued that some the present tax contributions and breaks should be used on a cash basis like the SSIA schemes, rather than straight forward tax breaks, which would offer a more attractive scheme to people on lower incomes.
"It could mean in the future offering a matching contribution rather than a tax relief - a pension package that maybe would be more attractive and would be more user-friendly for people particularly on lower incomes."
He said that the government should further encourage people to invest some of their SSIA savings in pensions.
"The more successful that encouragement is, the more likely it is that the government will continue to expand that route," Brennan said, adding that this is a crucial scheme for low paid workers.