Séamus Brennan (Dublin South, Fianna Fail)

Pensions are complex but it is critical to have them. It is incumbent on all of us to try to strip away the complexity and get to the heart of the matter. Pensions are about the income of ordinary people during their later years and about providing a sense of security that this income will be there each month. While the area of pension fund managers, investment managers, yields, bonds, equities, properties, etc., is complicated, there is also an essential simplicity involved. It is incumbent on all of us to constantly highlight this and to measure the complexity against the simple objective of ensuring security, safety and sufficient income for everybody in their later years.

Senator Terry has consistently spoken on behalf of pension fund customers and she has highlighted a wariness we should all have about the management and solvency of pension funds. I have no difficulty with that but the spirit of her amendments has been addressed. The Pensions Act 1990 established the Pensions Board. The board includes the Director of Consumer Affairs, pension industry representatives, social partners and so on and it is made up this way to achieve the consumer protection referred to by the Senator. The board is required to monitor and supervise the provisions of the Act, which provides a strong regulatory regime on behalf o the consumer.

The Act also establishes significant protections for individual members of schemes and provides generally for the regulation of occupational pension schemes. It also provides protection of members' benefits through the preservation of benefits, funding standards and equal treatment requirements. That regime is in place to protect the individual.

Part 5 of the Act provides for transparency and openness through a broad disclosure regime, which is governed by detailed regulations. The Act also places onerous responsibilities on trustees to ensure occupational pension schemes are properly administered, members' pensions rights are fully safeguarded and they and their dependants ultimately receive the pensions they have earned. The Pensions Acts are stringent in these areas and trustees are required to follow certain practices in making that happen. This legislation also contains substantial improvements. It provides that trustees must be of good repute and have relevant qualifications.

The Pensions Act 2002 provided for the appointment of a Pensions Ombudsman. That was a significant development in consumer protection. The Pensions Ombudsman investigates and adjudicates on complaints and disputes involving occupational pension schemes and PRSAs. The office is completely independent and impartial and has done a fine job to date. The Act also provided for PRSAs. Charges are capped and investments are restricted. The Pensions Board supervises the activities of providers in regard to their approved products and it monitors PRSAs. The board's website contains a list of approved products and charges and a consumer guide to PRSAs was published by the Consumers Association of Ireland and the board to aid consumer protection.

With regard to the disclosure of charges, persons entering into pension contracts receive full disclosure of all potential and actual commissions and other charges payable by contributors. That should address the Senator's concerns in this area. In addition, changes to charges must be notified at least two months beforehand. A significant number of consumer protection measures are in place and the Pensions Board remains vigilant in overseeing these measures. IFSRA published a draft consumer protection code and the board will monitor that closely to see if it can be improved.

I have no difficulty with the spirit of the Senator's amendments but her concerns have been addressed in the array of legislative measures relating to responsibilities of the Pensions Board and IFSRA and the emphasis on consumer protection. They must be kept under review to ensure consumers are fully informed and protected before embarking on a pension strategy for themselves or their dependants.