Terence Flanagan (Dublin North East, Independent)
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145. To ask the Minister for Finance the position regarding a pension in respect of a person (details supplied) in Dublin 3; and if he will make a statement on the matter. [44584/13]

Michael Noonan (Limerick City, Fine Gael)
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I assume that the Deputy's question relates to an individual with an Approved Minimum Retirement Fund (AMRF) who wants to have access to the fund. AMRFs are part of the Approved Retirement Fund (ARF) regime introduced in 1999. The ARF regime gives a considerable degree of control, flexibility and personal choice to individuals in Defined Contribution pension arrangements in relation to the drawing down of benefits from their pension plans. These choices include the options to purchase an annuity, to receive the balance of the pension fund in cash (subject to tax, as appropriate), to invest in an approved retirement fund (ARF) or an Approved Minimum Retirement Fund (AMRF), subject to certain conditions.

Under the regime, the options to:

- invest in an ARF, or

- receive the balance of the pension fund in cash (subject to tax, as appropriate)

are subject to conditions. The conditions include the requirements that the individual be over 75 years of age or, if younger, that the individual has a guaranteed level of pension income (specified income) actually in payment for life at the time the option to effect the ARF or cash option is exercised. Finance Act 2011 increased the guaranteed level of pension income required from the previous fixed amount of €12,700 introduced in 1999, to a variable amount equal to 1.5 times the maximum annual rate of the State Pension (Contributory) bringing the “specified income” requirement to €18,000 per annum. In Finance Act 2013, I rescinded this increase and reinstated the original lower specified income requirement of €12,700 on the grounds that the Finance Act 2011 change did not provide for adequate transitional arrangements to allow individuals to adjust to the increased pension income requirement.

Where the specified income requirement of €12,700 per annum is met by an AMRF owner at any time after retirement and before age 75, the AMRF automatically becomes an ARF with full access to the funds, subject to taxation as appropriate. It should also be borne in mind that (irrespective of the level of guaranteed pension income) an AMRF owner can access the funds in an AMRF at any time for the purpose of purchasing a pension annuity.