Barry Andrews (Dún Laoghaire, Fianna Fail)

I thank the Minister of State for his comments. I wish to address two issues in which I have taken an interest — child care and pensions. Like the Minister of State, I welcome the proposals which will make a great difference to people struggling to manage their domestic and working lives. The Bill contains some imaginative and useful proposals. I hope in future we can expand the benefit-in-kind rules in the taxation legislation so that it will be simpler for companies to extend benefit-in-kind to their employees without tax. In that way, employees will know that is a right they can argue for in the context of pay negotiations. I also hope that in conjunction with this Bill, planning legislation will be relaxed to allow for much greater access to child care facilities.

There should also be a requirement to ring-fence development levies for child care. As things stand, there is simply a discretionary duty on the county manager to include child care as part of a development. This should be specifically ring-fenced and made mandatory so that funding will be available for child care facilities from local authorities. On the other hand, employees will be able to negotiate benefit-in-kind in pay talks in the context of their employment. I hope that will happen in future but perhaps it is a bit early for it to occur now. The Taxes Consolidation Act contains certain provisions in this regard but they are much too complicated. My information is that only one employer in the State is taking advantage of those provisions, which is a clear failure of the original intention of that measure.

I also wish to refer to pensions. It is well known that in Ireland we are perhaps going backwards in terms of pensions coverage. The PRSAs have not taken off successfully, although the country is in the fortunate position of not having the worst demands on the pension sector because of the high working population to dependants ratio. In addition, the older segment of the population is not as high a percentage as in other countries. We have, therefore, an opportunity to solve the pension problem for future generations.

To the credit of the Minister for Finance's predecessor, Mr. McCreevy, the National Treasury Management Agency manages a large fund for future pensions, which is to be commended. The current State pension is heading towards €200 per week, which is also commendable. Currently, however, only 50% of workers have pension coverage, which is far short of the 70% target.

Recently, the Pensions Board suggested that compulsory pension coverage should be introduced but, in my view, this is not a very well thought out suggestion. I admit that the Pensions Board was split on the issue but there are clearly those who hold that view, including the Minister for Social and Family Affairs who suggested it as a possibility. It would, however, penalise employers and small businesses in particular. In other countries, employees and employers share the contributions to mandatory pension schemes. Inevitably, however, employees will seek that their half should be paid through wage increases. We live in a competitive environment for insurance rates and other requirements on employers, so if mandatory pensions were to be introduced, it would have a bad effect on small and medium-sized enterprises which do not have the resources, expertise or time to devote to setting up such a system.

The recent Central Statistics Office figures also show that we had a reduced pension coverage in 2005 compared with 2004. We need to take advantage of the fact that people are willing to save — the SSIAs are a classic example of that — and tap into it. The Minister is to be commended on the €1 for €3 initiative when SSIAs are used for pensions, but there is much more potential for development in this area. What is missing is a high profile campaign to make people aware of the need to provide for pensions. Such a campaign should paint the stark picture that because so few have pension coverage, many people will face into a difficult retirement period. We need to undertake such a campaign straight away.

We also need to introduce the concept of a pensions regulator, as they have done in the United Kingdom, to increase public confidence in pensions. Currently, the Pensions Ombudsman is simply a reactive office which deals with queries as they arise.

While we face a real challenge on pensions, the Bill has gone a long way towards improving the situation as well as ameliorating the issue of child care. There is great potential for tackling both issues. Thanks to the Government's financial management, we will be able to deal with such problems in future.

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