Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

I have a question for Dr. Keane on that specific matter and her study of the modelling of the lowest 40%. She said the auto-enrolment does not really have an impact on them because they are under the €20,000 income threshold.

They are under the €20,000 income threshold. Most of the income for a lot of the people within that cohort is not employment income. We have heard evidence from the insurance industry in various guises, who have argued strongly that the threshold of 20% should be reduced. They gave the example of the UK where it is £10,000 and that they are even considering reducing that to £7,000. The Department of Social Protection, Community and Rural Development and the Islands have made the opposite argument that in relation to that cohort with under €20,000 income, the most important pension for them is the State contributory pension and the investment in that is where the focus needs to be. This is an issue that committee members have previously raised as an issue of concern. In terms of the modelling that has been done on those thresholds, if we were to reduce that threshold from €20,000 down, has that modelling been done or can it be done? Can the witnesses give the committee an indication if we reduced the threshold from €20,000 to €15,000 or €10,000 what would be the outcome? That is my first question.

My second question is for Dr. Roantree. It relates to the case he made very well and he has given the committee a lot of food for thought in terms of the evidence he has provided. In terms of the issue of portability, one of the biggest challenges we have regarding the State contributory pension is workforce participation. We saw a phenomenal increase in that during Covid-19 because there were more options in terms of flexibility. The reality is that if we want to increase incrementally over time and deal with the potential pension deficit in relation to the State contributory pension, if we can increase workforce participation rates that will have a dramatic impact on that. One of the ways to do that is by flexible working. Dr. Roantree referenced that auto-enrolment could be a potential barrier to moving between employments. Could it also be a barrier to moving between full-time and part-time work, or between mixed part-time employers as well? My question is whether we could inadvertently, through an auto-enrolment system that cannot be blended with an occupational pension system because of the way the taxation is structured, end up creating barriers to flexible employment and barriers to workforce participation that could cause us financial problems down the road as regards the social insurance deficit by 2070 or 2075. I know that question has a very broad scope but perhaps Dr. Keane could come in and Dr. Roantree could muddle over that one for a minute.