Heather Humphreys (Cavan-Monaghan, Fine Gael) | Oireachtas source

I thank the Deputy for raising this matter. Compared with other countries in the OECD, the proportion of employees in Ireland with supplementary pension cover is low, with just over 50% of the working population having an occupational or personal pension.  This rate reduces to 35% when the private sector is considered in isolation.  As a consequence of this low supplementary pension coverage rate, many retirees may suffer an unwanted reduction in living standards when they retire.

To address this low coverage rate, a system of automatically enrolling employees into a quality assured retirement savings plan, with freedom of choice to opt-out, has been progressed by previous Administrations. Although A Roadmap for Pensions Reform 2018-2023 provided for the development and implementation of an automatic enrolment, AE, retirement savings system by 2020, this Government recognises the exceptional strain that both employers and employees are now under as a result of the Covid-19 emergency. 

The Department of Employment Affairs and Social Protection continues to work on the design of the AE system.  There are five main areas where work is ongoing so as to produce design options for Government to consider.  These areas relate to: the scope and role of the central processing authority; the nature and functions of the registered providers; the investment framework and funds to be offered by registered providers, including the design of the default fund and the pay-out phase; the design of the State financial incentive; and the phasing of implementation.

In progressing this work, the Department is receiving technical support from the European Commission’s DG Reform, which assists EU member states implementing administrative and institutional reforms. I hope this clarifies the matter for the Deputy.

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