Tommy Broughan (Dublin Bay North, Independent)
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205. To ask the Minister for Employment Affairs and Social Protection her plans regarding the auto-enrolment of workers in the private sector in pension plans. [45628/19]

Noel Grealish (Galway West, Independent)
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213. To ask the Minister for Employment Affairs and Social Protection if the concept of the proposed auto-enrolment pension scheme conflicts with the existing personal retirement savings account system, which operates without the need for a central processing agency; and if she will make a statement on the matter. [45757/19]

Regina Doherty (Meath East, Fine Gael)
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I propose to take Questions Nos. 205 and 213 together.

I am pleased that the Government recently approved significant elements of my design of an automatic enrolment retirement savings system which will commence in 2022.

It has long been recognised that supplementary pension coverage in Ireland among private sector workers is too low. It is estimated that just 35% of private sector workers have supplementary pension coverage through either occupational or private pension schemes. This can lead to these workers being reliant solely on the State Pension in retirement, which may result in a significant and unwanted reduction in their living standards.

In order to address this challenge, the Government has committed to begin implementation of a supplementary retirement savings system, known as Automatic Enrolment (AE), by 2022. AE will see a transition from the current and purely voluntary system to one which will, subject to certain parameters, automatically enrol employees into a quality assured retirement savings system. The saver will maintain the freedom of choice to opt-out. Moreover, the AE system is being designed to complement existing private pension provision, and in no way conflicts with the current private pension landscape.

Key decisions have now been made in relation to the target membership, the contribution rates, the policies in relation to opting-out and re-enrolment, the administrative arrangements and organisational approach and the investment options.

In relation to the target membership, employees aged between 23 and 60, who earn more than €20,000 a year (across all employments) and are not already contributing to a workplace pension, will be automatically enrolled. Employees who are existing members of a pension scheme/contract that meets prescribed minimum standards and contribution levels will not be automatically enrolled for the employment to which that pension relates.

The introduction of AE will help to ensure that workers in the private sector are enrolled in quality assured pension schemes which, by supplementing the State Pension, will provide an adequate income in retirement.

I hope this clarifies matters for the Deputies.