Paul Bradford (Independent) | Oireachtas source

I welcome the Minister of State. I support the recommendation presented by my two colleagues. I appreciate that the Minister of State is probably taking instructions from Beijing, but we hope at least that he will listen to our submission, and, if he cannot respond favourably today perhaps it is something that he and his officials can reflect upon.

If I can meander slightly, the pensions industry and crisis are worthy of deep and sustained debate. I know the Minister for Social Protection, Deputy Burton, is working in this regard. I hope that at some future stage we will arrive at a position where we have a strong national pension scheme that can deal with all of the anomalies, difficulties and problems arising from our population shift and the balance between young and old. Anyway, we must deal with the current situation and what is before us.

The PRSA system worked well when it was first introduced. It encouraged many people to take up private pensions. The figures presented to me suggest, however, that since the budget measures of 2011 PRSAs have suffered a significant disadvantage in comparison to other pension schemes. Basically this arises from the fact that the USC is now payable by the pension contributor on the basis of the employer contribution. It may well be a significant reason for a reduction in the number of people taking on PRSA arrangements. I am advised that currently there are some 19,200 employer PRSA arrangements and this covers 77,300 employees, a substantial figure. This is something we should not only seek to defend but encourage and expand on.

I am not in any way an actuarial or pensions expert but when advice is given to me from reputable pension practitioners and companies I must at the least put their concerns on the record of the House and call on the Minister of State and his officials to respond. We are advised that there is a significant fiscal disadvantage in comparison to other pension arrangements because of the forced payment of the USC.

The recommendation speaks for itself. I appreciate how Members of this House must work in respect of the Finance Bill. Our modest recommendations are not even amendments. Anyway, I hope it will cause the Minister of State to take the issue seriously and, in the course of time, perhaps, try to remedy the situation.

The State pension system is financially insufficient and will be population-challenged in the coming years. If we are to encourage people to make private arrangements at the least we should ensure that such arrangements are not a disincentive and that there is some balance and fairness. I support the recommendation.

I am sorry I missed the debate on Second Stage as it is an issue about which I would have spoken. I look forward to hearing the observations and plans for the coming months to deal with what appears to be an anomaly that is stopping people from entering into arrangements that we should all encourage.