Richard Bruton (Dublin Bay North, Fine Gael) | Oireachtas source

The Deputy raises a very important issue. There is widespread under-provision in pensions and, as she rightly said, the under-provision is much more acute among women workers than among male workers. While I do not have the figures to hand today, from memory less than half of workers had access to any pension support other than the State contributory scheme. This has been a feature of our provision over many years.

Deputy Burton is in the Chamber. I know the previous Government took action to ensure that every employer would have to provide the option of a scheme to every worker. Therefore there is an obligation on employers to provide such a scheme. The State, of course, supports though tax breaks people participating in such a scheme. The wider issues of whether there should be compulsory contribution into a scheme or whether it should be automatic enrolment with an obligation to drop out are very significant and need to be assessed in detail. Obviously much work is required initially assessing the potential impact of them and considerable consultation on them would be required.

I do not have access to when the work will be completed, but it is a very important issue which poses problems for long-term funding for all of us as we live longer and remain reliant on the State for much longer.

The State pension, which was introduced in 1953, was based on contributions by people who were at work. That has been the model and access is done by way of averaging over one's entire life. That has favoured people who, for example, entered late and were just in the scheme for a short period and get a full pension while others, as Deputy Catherine Martin described, who drop out for periods can have their rights diluted. One of the issues that has been examined by the Department is whether one should move to a total contribution approach rather than using the averaging rule. The difficulty with such a change is that there could be losers as well as winners in such a scheme.

I understand the Department has indicated in the course of replies to parliamentary questions that the law would have to change retrospectively for homemakers and that would have a significant cost. From recollection, more than €250 million would be involved. Again, it would have to be assessed in the context of other budgetary options that fall to be considered by the State. This is a complex area and having a full pension review that evaluates all of those issues, and tries to decide where the allocation of responsibility falls between employers, individuals and the State, requires careful work. I look forward to that review which has not come to Government at this point.

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