Sheila Terry (Fine Gael)

I move amendment No. 8:

In page 22, before section 30, to insert the following new section:

"30.—The Principal Act is amended in section 10 by inserting the following new paragraph after paragraph (a):

(aa) to carry out periodic reviews in order to ensure that there is a fair consumer-provider balance in the regulation and control of the pensions industry.".

These amendments are intended to ensure protection for the individual pensioner. I spoke with the Minister on this issue previously and told him that many of the developments in pensions legislation seem skewed towards the industry rather than consumer protection.

The Pensions Board exists to act as guardian for the consumer. While it exists to promote the provision and extension of pensions, it must get the balance right between the provision of pensions and the extension of rights to the consumers and provider. The Minister will probably tell me the board is responsible for maintaining the balance. However, the balance is not apparent and it seems to me that the board works on behalf of the pensions industry to promote pensions. We see little coming from the board with regard to the protection of the consumer.

Amendment No. 9 seeks to insert a section that will provide a consumer protection code. This code should be drawn up by the pensions board and all pensions providers should be bound to comply with it. This is another measure to ensure the consumer is protected and that all companies within the industry live up to the code. These protection provisions should come from the pensions board because that is the reason it exists. I hope the Minister will accept these amendments and show there is concern for the consumer.

As I said recently, the Minister must be aware of the crisis in the pensions industry. The public does not have any confidence in the industry and that is the reason people are not taking out pensions. Despite the €500,000 provided to the pensions board for a public awareness campaign over the past couple of years, people are not buying into pensions or PRSAs. People bought into the SSIAs because they knew what they were buying into and that they could take a risk with equities or take the safe option and know what they would get at the end of the day. People will not buy into the pensions industry any longer because for too long they have seen their parents' pensions eroded to the point where they are not worth the paper they are written on by the time they come to draw them. We need to win back the support of the consumers. By offering them some protection, we may encourage them to take out pensions, but much more must be done before we can win back their general support in this regard.

Amendment No. 10 requires that all advertisements relating to pensions should carry a warning to consumers informing them of the risks involved, that benefits are not guaranteed and making them aware of the charges and fees involved. The funds of many companies are currently underfunded and they are asking their employees to move from defined benefit schemes to defined contribution schemes. As well as asking them to change, they are charging outrageous fees for doing so. This area needs to be investigated. Much of the money that goes to the pensions industry is eaten up by fees paid from the money paid by consumers into their pension funds. This is one of the reasons the pensions many people get when they retire are not worth the paper on which they are written.

I urge the Minister to ensure that pensions, like mortgages, carry a warning in their advertisements. This is not asking too much. People are encouraged by the Government to take out a pension, but they should be told of the risks associated with these occupational pension schemes, particularly schemes with defined contributions. I do not know much about pensions. The area is a minefield and most people do not understand it. The pensions industry likes to keep it that way because if we knew more about it, fewer people would buy into it. Therefore, I urge the Minister to ensure that the pensions board will ensure that all advertisements carry warnings regarding risks, fees and charges associated with pension products.