Róisín Shortall (Dublin North West, Social Democrats)
Link to this: Individually | In context | Oireachtas source

1846. To ask the Minister for Employment Affairs and Social Protection if she will respond to the Citizens Assembly recommendations regarding a mandatory pension scheme to supplement the State pension; and if she will make a statement on the matter. [37819/17]

Regina Doherty (Meath East, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The rate of supplementary pension coverage in Ireland is 47% of the working population and this reduces to 35% when the private sector is considered in isolation. Whilst the State pension provides a reasonable basic level of income and guards against poverty in retirement, if measures are not taken to address this low rate of coverage, many future retirees will experience unwanted reductions in living standards when they reach retirement. Therefore, I would welcome the broad support for reform evident in July 2017 in the Citizen’s Assembly deliberations regarding retirement income and where 87% agreed with the proposal that the Government should introduce some form of mandatory pension scheme to supplement the State pension.

I intend to make pension reform a priority in my term as Minister for Employment Affairs and Social Protection. To this end, I can confirm my intention in the coming months to publish and commence the implementation of a number of measures for the reform of pensions.In addition to a range of other long term reform measures, I will detail proposals for a transition from the current and purely voluntary supplementary pension system to one which will, subject to certain parameters, automatically enrol employees into a quality assured retirement savings system. This reform, where the saver will maintain the freedom of choice to opt-out, will encourage long term saving and asset accumulation amongst those who may otherwise suffer a reduction in living standards at retirement. It will increase the wellbeing, financial security and independence of future retirees.

A review of international auto enrolment retirement systems has confirmed that success is dependent on well tested design and securing member trust. To this end, detailed evidence building and consultation will be undertaken to inform fundamental choices which are required regarding the preferred operational structure and organisational governance for a new system as well as design elements such contribution levels, financial incentives and target membership. Correctly positioning/designing each of these will be critical to the success of any system.

I hope this clarifies the matter for the Deputy.