Phil Hogan (Carlow-Kilkenny, Fine Gael)
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Question 101: To ask the Tánaiste and Minister for Finance his views on whether the State is saving enough to provide for pension provision. [29686/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I assume the Deputy is referring to the National Pensions Reserve Fund.

The National Pensions Reserve Fund (NPRF) was established under the National Pensions Reserve Fund Act 2000. The purpose in establishing the Fund was to meet as much as possible of the cost to the Exchequer of social welfare pensions and public service pensions to be paid from 2025 until at least 2055. These costs are expected to increase significantly, due to increased life expectancy and declining birth rates, and will give rise to serious budgetary issues, in particular the capacity to continue to fund social welfare and public service pension liabilities on a pay-as-you-go basis.

The legislation requires that 1% of GNP is to be paid every year from the Exchequer into the Fund. The amount being paid into the Fund this year is €1.616 billion and the market value of the Fund at end-September 2007, according to the National Pensions Reserve Fund Commission, was €21.26 billion.

As the Deputy will appreciate, it was never the intention that the Fund would be able to cover the full cost of social welfare and public service pensions. As envisaged from the outset, the assets accumulated in the NPRF will go some way towards easing future funding concerns but are not expected to meet the full cost of projected pension liabilities.

I might add that the National Pensions Reserve Fund Act 2000 provides that the National Pensions Reserve Fund Commission is to commission, from time to time, assessments of the projected profile of Exchequer outlays on public service pensions and on social welfare pensions, after consultation with the relevant Ministers.

The Deputy may wish to note that the recently-published Green Paper on Pensions included projections in relation to the future cost of public service and social welfare pensions.