Brian Hayes (Dublin South West, Fine Gael)

I am in the Cathaoirleach's hands. These recommendations seek to deny an insurance company or pension scheme trustees the option to adjust current or future benefits of the pension scheme or contract of assurance to take account of the levy being paid by them. It is up to the trustees and administrators to decide whether and how the levy should be passed on and who should be affected, as well as to what extent, given the particular circumstances of the pension funds or pension plans for which they are responsible. The Minister for Finance has sought to provide, in so far as he can, that where the option to reduce benefits is taken by the trustees of a pension scheme, the imposition of the levy is not carried out in a disproportionate way. The Bill also gives the Revenue Commissioners authority to review any cases where assets are disposed of by administrators or trustees to pay the levy to ensure that any such disposals are in keeping with or are needed to pay the levy. It also gives the Revenue Commissioners oversight authority to review instances in which benefits are adjusted as a result of the payment of the levy to ensure that any such adjustment is made in accordance with the requirements of the levy legislation. The Minister for Finance has made known to pension industry representatives his view that there is scope for the industry to absorb the impact of this temporary levy by way of a reduction in fees and charges made on these schemes. He has written to the industry representatives in this regard and awaits their response.

As Senator O'Brien has observed, however, each individual pension scheme is different and it is a matter for the trustees of each scheme to determine the appropriate manner in which the levy will be paid. The point being made in the legislation is there are many means by which this can be absorbed. In the first instance, for example, a fund could have a good year. The point was made during an earlier part of the debate that 90% of these funds have been invested outside the country and, at one level, that is a good thing given the collapse of property prices and investments in Ireland in recent years. However, the point is that the charge could be absorbed if a fund does well in one particular year. I accept both that there is no standard across-the-board management fee and that the larger the fund, the greater the management fee. At the same time, however, one must be honest in this regard. Those who pay into such funds also are consumers and fundamental questions must be asked about the management fees that have been charged willy-nilly across the pensions industry for a considerable time. While I do not suggest that all funds charge fees of 2% or 1.5% - such a suggestion was made in the other House - and am sure there are many examples of fees of 0.7% or 0.8%, some of this levy can be absorbed if people manage their business. Everyone must do that and the entire objective of the banking restructuring plan is to be able to absorb some additional costs by having a restructuring plan and reducing costs. That is my point regarding the absorption question.

I also wish to respond to the general issue unless the Cathaoirleach wishes-----