Michael Noonan (Limerick City, Fine Gael)

The levy is not retrospective. It is being calculated on the annual value of each pension fund as of 1 January of each year from 2011 onwards. The levy is similar to stamp duty. It is on the value for the year and will be paid in two tranches each year. It will be paid in two tranches in 2011 for the full value of the fund and then each year thereafter, ending after four years. The Revenue Commissioners will be responsible for its collection, in respect of which I do not envisage much difficulty. The Deputy will be aware that pension fund managers impose charges for their services. The industry has assured me it will be simply a case of adding 0.6% to its charges and transferring the value of that to the Revenue Commissioners. The levy will be paid to the Revenue Commissioners at the same time as pension funds pay normal charges. This will be done twice a year. There is no particular difficulty in that regard.

On pension funds in difficulty, we have made two exceptions, as announced by me on Tuesday, namely, pensions for the benefit of non-residents are exempt because that would be unfair and probably not legal and where a motion has been passed by May of this year to discontinue the activity of a fund, such fund will be exempt. As I said previously, hard cases make bad law. If there are hard cases to which the industry wishes to bring my attention I am prepared to discuss them with it. This is a modest proposal on a group of people who have built up funds having received a generous 40% tax relief. It will end after four years and will not drive anybody to the wall. This is a modest proposal.

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