Mary Hanafin (Dún Laoghaire, Fianna Fail)

There are two pensions issues. The first is the long-term strategy and the other is the immediate difficulties faced by some pension funds. Since the publication of the Green Paper over a year ago there has been a widespread consultation process, a summary of that consultation and a review at a conference in Ireland of the international situation, particularly looking at the experience in Australia, New Zealand and in the UK. Drawing from the best of that, we are now actively working on the matter.

It will be up to the Government to make a decision on this. It will not be for me alone. That is why it is important that these meetings my Department is having with the Department of Finance and the Department of the Taoiseach should go ahead and come up with suggestions on how the framework should develop over the next number of years. It will probably not take effect until 2012, and beyond in the case of some of the suggestions within it, bearing in mind the requirement that there should be on people to make provision for their future as well so that they would not be dependent solely on the State pension.

I do not believe it came as a surprise to anybody that pension schemes were in difficulty. Pension schemes are investment schemes and investments in the markets have been badly hit because of the volatility of the markets. One of the things one can say about the markets is that in the same way as they go down, they also go up. At this moment in time there are a number of funds which will not be able to meet the funding standard for this year. Over 80% of them at the end of last year stated they were able to meet all of their liabilities. There will be many more in difficulty this year.

However, no pension fund has gone bust. No pensioner or prospective pensioner has been left in any difficulty. Where in the past difficulties have arisen the employers have made good the gap which arose.

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