Louise O'Reilly (Dublin Fingal West, Sinn Fein)
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71. To ask the Minister for Employment Affairs and Social Protection the provisions that have been made to ensure that agencies, organisations, charities and service providers funded by his Department will be able to meet their obligations under the new auto-enrolment scheme. [62181/25]

Louise O'Reilly (Dublin Fingal West, Sinn Fein)
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My question, as is often the case, is very straightforward. I am looking for information about the provisions that have been made concerning agencies and organisations which deliver services on behalf of the State, are funded by the State and have workers who want to be part of the auto-enrolment scheme but are concerned they are not funded to be able to do that. The Minister will well know the last time there was a cut to the budget of these agencies, they were told to find the savings from within their own envelope. That really did not work out well.

Dara Calleary (Mayo, Fianna Fail)
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Gabhaim buíochas as an gceist. The auto-enrolment savings system, known as My Future Fund, will commence on 1 January 2026. My Department has had extensive engagement with employers, including those in the community and voluntary sector, and with Government Departments, since the release of the automatic enrolment strawman public consultation in 2018. Its impending implementation has been well flagged to all those groups since the enactment of the auto-enrolment Act in 2024 and extensively throughout this year. Therefore, employers have been given a substantial lead-in period to budget appropriately for its introduction, including through budget negotiation with sponsors where appropriate.

It is worth mentioning that, in response to feedback from that consultation, the design of the auto-enrolment system provides for phasing in of contribution rates over a decade. Employees will be required to make initial contributions of 1.5% of gross earnings, rising by 1.5% every three years until they reach a maximum contribution rate of 6% in year ten. These contributions will be matched on a one-for-one basis and on the same timeline by employer contributions and topped up by the State at a rate of €1 for every €3 contributed by the employee. That phased approach has arisen as a consequence of the consultations the Department has undertaken in the design of the system. For community and voluntary groups and employers generally, this approach gives clear certainty on the rates that will be applicable so as to facilitate the gradual absorption of labour costs.

My Department has been very proactive throughout this year - and indeed previously - in advising other Departments, including the Department of Public Expenditure, Infrastructure, Public Service Reform and Digitalisation, about this issue.

I will be taking the opportunity again to remind my Cabinet colleagues in coming days. Automatic enrolment is starting on 1 January and no worker should be disadvantaged as a consequence.

Louise O'Reilly (Dublin Fingal West, Sinn Fein)
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However, they are going to be disadvantaged if the Government does not fund them. Bearing in mind the hands-off approach that the Government takes to these agencies, we should remember that although it caused the homelessness crisis with its policies, it has asked people to come in to shore it up. Some of the agencies are funded only by the State, and if they do not have additional funding – I have checked in the budget and I do not see that there is any – it will simply mean they will have to try to find it from within their existing budgets, which means either pay cuts or cutting back on services. Neither of those options is viable.

I would like to hear from the Minister confirmation that he believes all those funded by the State will be in the desired position. As the Minister said, the contributions from the worker have to be matched by employer contributions. They have no capacity to raise money on their own. Therefore, is the State going to fund it, and can the Minister confirm that this morning?

Dara Calleary (Mayo, Fianna Fail)
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The position is that automatic enrolment is a legal requirement. Therefore, the employers will have to give access to My Future Fund to employees aged between 23 and 60 and earning over €20,000 who do not have an existing payroll-connected pension.

We have made it very clear in the Department that this is happening. The point has been made at official level, including to the Department of public expenditure, that this is happening on 1 January and that people need to make provision. We have also made the point to all employers across the State.

We have worked closely with groups such as ICTU in relation to this. I attended a really good seminar with ICTU a few weeks ago, on 23 October. ICTU is fully behind this and is very aware of it. In fact, it was very frustrated that we did not introduce this in September. It has been engaging with its members across the country to get ready for it.

I want to make it very clear that this is not an opt-in for employers, regardless of who they are. If there is an employee who fulfils the criteria and who is not linked through payroll to a pension at the moment, he or she will be covered.

Louise O'Reilly (Dublin Fingal West, Sinn Fein)
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The Minister and I know they are covered, but my question is on whether they are funded. The Minister of State says he has had extensive engagement, and I absolutely do not doubt that for a moment. I would say his engagement was exceedingly extensive; however, as a result of his engagement, have his Department and other Departments confirmed that the agencies they fund to deliver services will be in a position to meet their obligations to all of their workers without having to cut back on services or wages? If they have not been given extra money and do not have the capacity to generate money, we are back to where we were at the time the Minister’s party crashed the economy, when it gave the instruction to people that they did not necessarily have to cut pay but had to cut back. The Government told them not to cut services, so in the end they did cut pay.

We can imagine that people who were burned before are very anxious to know if they are going to be in a capacity to join the scheme. The employers are anxious to know if they are going to be funded. My fear is that they are not funded at the moment and that we are going to end up in a situation where some people may be excluded or some agencies may have to make decisions that we do not want them to have to make.

Dara Calleary (Mayo, Fianna Fail)
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All employers have had seven years to get ready for and get used to this. We listened to their feedback on stepping the contributions and not introducing big contributions from the beginning.

I confirm that in the Department of Social Protection, the Estimates in respect of payments to the organisations do include costs for, say, community employment and Tús where they arise. We have engaged at senior official level and with the Secretaries General of other Departments advising them that automatic enrolment was coming in on 1 January and that they needed to ensure provision. I cannot account for every other Department, but, on the back of this discussion, I will be reminding all my colleagues this afternoon that this is happening.

It is a huge event for 750,000 to 800,000 workers who currently have no pension provision. This is not a silver bullet. I want to be very clear that My Future Fund is not going to be the answer to everybody’s problems, but it is happening on 1 January.