Simon Harris (Wicklow, Fine Gael) | Oireachtas source

I am informed that approximately 90% of AMRFs are valued at less than €250,000. While this might seem like a lot of money, in the case of an individual retiring at the age of 60 or 65, it is clearly not because the money may have to last both the individual and spouse or partner for a period of time of 25 years or more. The Finance Bill amendment reduces the imputed AMRF distribution rate from 5% to 4%. It is targeted at individuals in the age group 60 to 70 years. It is intended to reduce the risk that individuals in that age group might outlive the funds in their AMRFs or their vested PRSAs. The introduction of stepped increases in imputed distribution rates based on age, brings Ireland more into line with the draw down position internationally for similar post-retirement funds. An AMRF represents a flexible alternative to the purchase of a pension annuity or the stream of taxable pension income. It is open to individuals who generally have defined contribution pension arrangements and do not wish to purchase in pension annuity. Anecdotal evidence suggests that most people with defined contribution pension funds are choosing the AMRF option and not purchasing the annuities. For individuals aged 70 or over, the current 5% imputed distribution remains, as does the 6% rate for large value AMRFs in excess of €2 million. We think the stepped 4%, 5% and 6% is a more appropriate measure.