Ireland to “grasp nettle” on pensions
IRELAND – The Irish government says it will “grasp the nettle” if it finds that it needs to make supplementary pensions mandatory.
Ireland’s minister for social and family affairs Mary Coughlan says the government’s approach to supplementary pensions cover – in the form of the recent launch of personal retirement savings accounts or PRSAs - “should be given one last chance”.
She told the Irish Association of Pension Funds’ annual dinner recently: “There are statutory requirements to review the coverage position within three years and if, at that stage, we find that we were only on a scenic route to a mandatory pension requirement, that nettle will be grasped in the most appropriate way at that stage.”
She said that mandatory employer access to PRSAs would come into effect from September 15 this year. “Having considered the matter I think that on balance it would be better to wait until later this year to introduce this measure.”
Coughlan added that a half-million euro pensions awareness campaign would start during the summer, timed to support the introduction of mandatory employer access to PRSAs.
And she quoted a recent paper by the Society of Actuaries in Ireland, which shows that the average total contribution to a defined contribution arrangement of 10% at present is “too low”.
The Pensions Board last week approved the first PRSA products.