John Halligan (Waterford, Independent)
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120. To ask the Minister for Finance if he and his Department have any immediate plans to restore the National Pension Reserve Fund; the estimated cost of this restoration, and over what period of time; and if he will make a statement on the matter. [18266/15]

Michael Noonan (Limerick City, Fine Gael)
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Following the commencement of the relevant section of the NTMA (Amendment) Act 2014 on 22 December 2014 the assets of the National Pensions Reserve Fund (NPRF) became the assets of the Ireland Strategic Investment Fund (ISIF).

I should make clear that the NPRF was never expected to meet the full cost of providing social welfare and public service pensions. The NPRF was a supplementary investment fund intended to support the Exchequer when budgetary pressures increased as a result of mounting pension costs.

While the need for the State to provide for the cost of social welfare and public service pensions has not abated, the Government decided that fostering economic activity and employment through the establishment of the ISIF was the immediate priority.  This support for economic activity and employment puts the State in a better position to meet its pensions obligations in the longer-term.

In relation to public sector pension costs, the steps this Government has taken in terms of introducing the Single Pensions Scheme will produce significant savings in the longer term.  In addition, there is expected to be a significant reduction in public sector pensions following the pay and pension cuts since 2009 and the freeze in pay and pension rates until after the Haddington Road Agreement.

The most recent actuarial valuation of Public Service occupational pensions carried out by the Department of Public Expenditure and Reform estimated the total accrued liability at €98bn as at December 2012. This compares with the previous estimate of €116bn for 2009 which was arrived at by the Comptroller and Auditor General (C&AG). Therefore, over the three years from 2009 to 2012 the liability fell by €18bn or by 16%.

At the time of the transition to the ISIF (end 2014) the total value of the NPRF including the Directed portfolio was €22.2 billion.  As well as the issue of a broad restoration of the NPRF it must also be noted that under the provisions of the NPRF Act 2000 1% of GNP was payable from the Exchequer to the NPRF each year. This would have meant a payment in the order of €1.6 billion to the NPRF for 2014 requiring compensating fiscal adjustments elsewhere.