IRELAND – The head of the Irish central bank has said that the country must not get complacent about how it deals with the pensions crisis.

John Hurley, governor of the Central Bank and Financial Services Authority of Ireland, said while Ireland’s strong economic growth increased its capacity for dealing with the issue, there was “scope for complacency for a number of reasons”.

He said that about 40% of the workforce, or nearly half of private sector workers, are not covered by an employment-related pension or an individual pension. Those not covered would be reliant on the state pension.

Speaking at the Cork Chamber of Commerce Business Breakfast, Hurley cited a recent estimate by the Ministry for Social, Community and Family Affairs which indicated that only about 25% of private sector workers have near-adequate pensions.

“Consequently, the whole issue must and is being kept under review to ensure that we are in a strong position to deal with the ageing of the population,” Hurley said.

All European countries would be faced with dealing with pensions issues, he said.

“In our own case, we are relatively well placed for coping with these issues. Firstly, the ageing of our population is relatively limited compared with countries like Italy and Spain.

“Secondly, some provision for public pensions is being made through building up the Fund by setting aside each year one percent of gross national product.”

Last week the Irish government announced plans to launch a general version of its tax-transparent Common Contractual Fund that is not confined to UCITS regulations – giving a boost to asset pooling.