Ivor Callely (Dublin North Central, Fianna Fail)
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Question 281: To ask the Minister for Finance the issues of concern that have been brought to his attention regarding SSIAs; if his attention has been drawn to abuses by either financial institutions or SSIA account holders; the measures in place in relation to ensuring the criteria that a person can only hold one SSIA account is adhered to; and if he will make a statement on the matter. [32966/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The SSIA scheme, which was introduced in 2001 is administered by the financial institutions under the guidance of the Revenue Commissioners. In excess of 1 million SSIAs were opened by 30 April 2002, the final date for opening of SSIAs under the scheme. Comprehensive guidelines, setting out the manner in which the scheme must be administered, was drawn up by Revenue, in consultation with the financial institutions at the commencement of the scheme. This is supported by compliance visits undertaken by Revenue each year to the financial institutions to ensure the terms of the guidelines are being fully implemented. Apart from that the financial institutions are obliged to report to Revenue any case where it is suspected that the rules of the scheme are being breached. On commencement of the scheme, each account holder was obliged to sign a declaration confirming their eligibility to participate in the scheme and that they would abide by the terms of the scheme for its duration. These terms include that the account holder was over 18 years of age and resident in the State; that s/he would operate only one SSIA; subscriptions could only be made from the individual's own or spouse's resources; subscriptions must not be funded by borrowings or deferral of existing repayments; that at least the minimum subscriptions be made in the first 12 months and that the maximum subscriptions levels be complied with for the duration of the scheme; and funds in an SSIA must not be used as security for a loan. In addition, before an SSIA can be matured, the account holder has to sign a further declaration confirming compliance with the rules of the scheme, including those relating to residency, for its duration.

Apart from cases reported by the financial institutions to Revenue in accordance with the requirement to do so, Revenue has extensive control systems in place to monitor the scheme and identify any potential abuses. These abuses include individuals with more than one account. Where an apparent breach of the rules is identified, Revenue fully investigates each case and takes appropriate action. I am advised by Revenue that the number of actual abuses is very small and have been appropriately dealt with.

Ivor Callely (Dublin North Central, Fianna Fail)
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Question 282: To ask the Minister for Finance the criteria for SSIA account holders to benefit form further involvement of SSIA funds for pensions; if issues of concern have been brought to his attention; and if he will make a statement on the matter. [32967/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The Pensions Incentive Tax Credits scheme was introduced by me to encourage SSIA holders, particularly those on low incomes, to continue the savings habit and to commence or improve their pension arrangements under the scheme. For each €3 of matured SSIA funds invested by an eligible SSIA holder in an approved pension product, the Exchequer will contribute an additional €1 by way of tax credit to a maximum of €2,500. The Exchequer will also contribute an additional tax credit relating to the exit tax deducted from the SSIA on maturity and based on the proportion of SSIA funds transferred to the pension product. The main condition attaching to the Pensions Incentive Tax Credits scheme is that gross income for the year prior to the year in which the SSIA matures cannot exceed €50,000. While there is no age limit to availing of the tax credits under the scheme, subject to normal pension rules, there has been some publicity given recently to the possibility that SSIA holders who are already retired might transfer matured SSIA funds into a savings product, claim the Pensions Incentive Tax Credits and then withdraw the topped-up amount immediately. This is not the purpose for which the incentive was introduced. Accordingly, I announced in a press release on 29 September last that I will introduce legislation at the earliest appropriate opportunity to ensure that, with effect from 29 September 2006, individuals who avail of the Pensions Incentive Tax Credits only to withdraw the funds immediately or within 1 year will not get the benefit of the incentive. I am also informed by the Revenue Commissioners that they have a good network in place with the pension providers so that any issues of concern that may arise can be addressed at the earliest opportunity.