Michael McGrath (Cork South Central, Fianna Fail)
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Question 91: To ask the Minister for Finance his views on the implications of the proposed pension fund levy on the take-up of private pensions and the contribution levels of existing pension holders; and if he will make a statement on the matter. [12647/11]

Michael McGrath (Cork South Central, Fianna Fail)
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Question 92: To ask the Minister for Finance if he will confirm that he does not intend to extend the proposed pension fund levy beyond pension funds to include other assets including commercial and household deposit savings and life assurance funds. [12650/11]

Michael McGrath (Cork South Central, Fianna Fail)
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Question 93: To ask the Minister for Finance the measures he will bring forward to moderate the impact of the pension fund levy on defined benefit pension schemes which are in deficit and may be required to reduce employee benefits to meet solvency requirements. [12651/11]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 91 to 93, inclusive, together.

I would very much hope that individuals already saving for their retirement and those considering doing so would not be influenced in a negative way by the pension fund levy. The levy is a relatively small charge on the significant assets of pension funds, much of which are represented by investments outside of Ireland. As the legislation introducing the levy makes clear, it is for a temporary four year period only and pension funds are being asked to make a contribution to getting the domestic economy moving again over that period. This is a reasonable and targeted tax measure being introduced to fund the various measures set out in the Jobs Initiative. The country is facing an economic and unemployment crisis and the Jobs Initiative will help tackle that crisis and applying a temporary levy to pension funds is less damaging economically than raising other taxes.

I am aware that the pensions sector is also concerned, given the imposition of the temporary levy, about the commitment in our agreement with the EU/IMF to reduce the tax relief on pension contributions starting next year. I have undertaken to examine this issue in the context of the results of the Comprehensive Review of Expenditure currently being undertaken by the Minister for Public Expenditure and Reform, and any resulting scope for fiscally neutral changes to the EU/IMF agreement.

There has been some speculation that the Government would proceed to "raid" investment funds or deposit accounts. I want to assure the House that the Government has no plans whatsoever in this regard. The Government regards it as its top priority to safeguard the security of savings and would not wish to consider any step that would impact negatively upon confidence. Other savings or investment products have not benefited from the generous tax reliefs that pension savings have historically been granted and continue to receive. Deposit accounts and savings products have already been subjected to additional taxation in recent budgets, via the increase in the rate of DIRT and exit taxes, neither of which impacted on pension funds.

The levy will not apply to occupational pension funds where the trustees pass a resolution to wind-up the fund and where the trade or undertaking in relation with which the scheme was established is insolvent. Neither will it apply, for example, to the assets of occupational pension funds in respect of the provision of retirement benefits to active, deferred or former retired members whose employment in relation to the scheme is and always was exercised outside the State. The aim, in this context, is to exclude members of pension funds approved by the Revenue Commissioners who have no connection with Ireland as such.

The chargeable persons for the purpose of the pension fund levy will be the scheme administrators, that is the trustees or other persons having the management of the assets of the pension schemes or plans. It will be up to those trustees and administrators to decide whether and how the levy should be passed on and who should be impacted and to what extent, given the particular circumstances of the pension schemes or pension plans for which they are responsible. In that regard, and as already indicated since the announcement of the levy, legislative provision is being made to allow pension scheme trustees or administrators the option to adjust the benefits payable under pension schemes or plans.