Ms Roma Burke:

That question ties in nicely with the Deputy's first question on why this might be more palatable now than the previously legislated for State pension age increases were. A couple of years ago when we saw those increases about to come through, everybody had a bit of an understanding about the problem but not everybody was fully informed, including myself. Before I became involved with the commission I thought that we did not need to worry about it, that more people would come into the country and that the average age of retirement would be maintained. Other people might have said that the State pension was getting more expensive but I thought the State would cover that cost. Everybody had a partial solution for this problem and everyone partially understood it but when the Commission on Pensions was formed, it set out to look at each of these ideas that people had, such as the possibility that migration or fertility might solve the problem. We took a systematic and evidence-based approach to examining each of those matters in isolation and to examine if they could be relied on, if they would help to solve the problem or if they would cause other problems as the Deputy has suggested. We looked at each one individually and we looked at the migration question purely in the context of a simplistic ratio, namely the number of working age people versus the number of people past the State pension age to see how we could maintain that. The Deputy is correct that if the population increases by 50% over the next 30 years there will be other significant challenges for the State in housing, healthcare, childcare and in people getting older and developing an entitlement in their own right. That would cause much wider challenges apart from just the State pension. It was important to us to examine how many people we would need if we just wanted to maintain that simple ratio. It demonstrated to us that the ideas we might have had previously, that a small increase in net inward migration might solve the problem, would not work. The process allowed us to tackle that and answer the question and now we can systematically move on to other headings that might help us tackle the challenge.

On Ms Feehily's comments on palatability, being forewarned is incredibly important. A key part of the second pillar of pension provision is telling people every year what they are saving, what they have saved to date and what they can expect at retirement if they continue what they are doing. That has been crystallised for people who are actively in employment as well as for people who might have saved for retirement but who have left their pension scheme to move to another job. Under recently introduced legislation, every year those people will get a statement that sets out their expectations and any assumptions surrounding that. It is a question of applying that approach to the first pillar of the pension system. We must give people that information so that they understand what they will get at retirement in order that they can plan and see if, for example, auto-enrolment or saving for a private pension and so on would be important and worthwhile for them. Forewarned is forearmed and action can be taken if needed and if no action is needed they know that as well if they are forewarned.