Eoin Hayes (Dublin Bay South, Social Democrats) | Oireachtas source

I endorse everything my colleague Deputy Quaide said. My secondary school history teacher is a wonderful man named Mr. Burke. He ignited in me a passion for history and politics. In his class, I learned about the invention of much of the welfare state in Germany in the late 19th century. It is hard for a society to imagine what things were like in previous eras but one of the welfare state's greatest contributions to life in the past two centuries have been the lifting of the elderly from poverty.

Before addressing auto-enrolment, I want to acknowledge that at this very moment there are people outside this building on hunger strike. They were put to work as children in industrial and reformatory schools and have called for some pension recognition for their child labour. As dark and unconscionable as that chapter in our history is, they are right to call for financial security in old age after falling victims to the crimes of a State that was supposed to protect them. I urge the Minister of State to meet with them and to meet their demands.

I welcome the Government's taking wider pension provision for our population seriously. Auto-enrolment can be part of securing the financial future of our society, but it is not a panacea and I would like to outline some of the outstanding risks it presents and, in some cases, deepens. First, in the middle of a cost-of-living crisis, reducing low-paid workers' take-home pay by between €300 and €1,200 per year may be devastating for many households. I do not need to remind the House of the devastating poverty figures we are already seeing. The number of children in consistent poverty has doubled in the past 12 months and 300,000 households are in energy arrears. What is the Government's plan to help those who, through the auto-enrolment scheme, will face issues in paying household bills or fall further into deprivation? It does not appear to have one, certainly not one that will keep up with inflation.

Second, another significant gap in the auto-enrolment scheme is the exemption of the self-employed on lower incomes. The gig economy workers, "solarpreneurs", the woman selling flowers on Grafton Street, the man with a van, the hard-working people delivering our meals — they deserve State support too and to exclude them from generous State subsidies in auto-enrolment seems grossly unfair and downright neglectful.

Auto-enrolment effectively State-mandates a permanent shift of the financial risk of old age from the State to the individual. As a constituent in Ranelagh asked me, if investment returns from their pension do not keep up with inflation, what do they do then? There are significant risks in using investments as the only vehicle for pension provision. I remember clearly the angry pensioners throwing eggs at the 2009 annual general meeting of AIB when they realised their hard-earned money had evaporated into the ether of the bank's recklessness and the financial crisis. Over the past 50 years, it has been fundamentally assumed that pension investments will in the long run generate returns beyond the rate of inflation, creating a good nest egg for those in old age. However, it is not certain this trend will always continue and there have been many examples in history where this has not been the case for investors, be they pensioners or otherwise. Is it prudent for us to believe the next 50 years will be like the last? I doubt it.

An opportunity to expand the investment capital of the State has been missed. We need domestic funding for home building. The Social Democrats have proposed such a fund, namely the homes for Ireland savings account, which would have invested in solving the largest problem our country faces - building homes. Why not put the additional savings toward such a worthy societal goal?

The greatest risk of auto-enrolment is it becomes an excuse to dismantle the welfare State in favour of major financial gains for pension funds and those who own them.

Will the fact that we have mandated every person in the country to fund their own pensions become an excuse to scrap the State pension all together? Our world before the welfare state was marked by a life that was cruel, brutish and short. Sometimes life is still like that, but the great contribution of the welfare state has been to temper its worst effects, especially for the most vulnerable. We would be the most unwise generation since the industrial revolution if we were to start dismantling it.

See this speech in context