Robert Troy (Longford-Westmeath, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

159. To ask the Minister for Finance if the guaranteed income of €12,700 associated with drawing down a private pension early is remaining at the current rate or if it will be increasing back to over €18,000; and if he will make a statement on the matter. [2037/16]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

In Finance Act 2013, I rescinded the Finance Act 2011 changes to the specified or guaranteed pension income requirement for Approved Retirement Fund access which had increased that income requirement from €12,700 to a variable limit based on 1.5 times the State Pension (Contributory) which amounted to €18,000 per annum. At the same time, I also rescinded the Finance Act 2011 change which had increased the maximum "set aside" amount required to be invested in an Approved Minimum Retirement Fund (AMRF) from €63,500 of the remaining pension fund (after taking the permissible tax-free lump sum) to a variable amount equal to 10 times the annual State Pension (Contributory) rounded to the nearest €100 which amounted to €119,800 or the remainder of the pension fund if less than this increased amount. Investment in an AMRF is a requirement for individuals with Defined Contribution pension arrangements who do not meet the specified income requirement and choose not to purchase an annuity.

I re-introduced the original specified income requirement (€12,700) and maximum AMRF set-aside amount (€63,500) on the grounds, among other reasons, that without an appropriate transition period, the 2011 Finance Act changes would detrimentally affect the plans of many individuals preparing for retirement over the medium term. The intention at the time of Finance Act 2013 was that the 2011 changes would be re-introduced in 2016.

In the context of the preparations for Finance Bill 2015 I chose not to re-introduce the 2011 changes and have no specific plans to do so at any particular point in the future.