Noel Grealish (Galway West, Independent)
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212. To ask the Minister for Employment Affairs and Social Protection the amount or percentage that the State will contribute to the proposed auto-enrolment pension system; and if she will make a statement on the matter. [45756/19]

Regina Doherty (Meath East, Fine Gael)
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I am pleased that the Government recently approved significant elements of my design for an automatic enrolment retirement savings system. These include key decisions 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.

As stated in the 'The Roadmap for Pensions Reform', the Government proposes 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.

There are five main areas where work is on-going so as to produce design options for Government to consider. These areas relate to the design of: the State financial incentive; the scope and role of the Central Processing Authority; the nature and functions of the Registered Providers; the investment framework and funds to be offered by Registered Providers, including the design of the default fund, and also the pay-out phase; and the phasing of implementation.

With respect to a State financial incentive, the Strawman proposal gave the illustrative example that the State could contribute €1 for every €3 contributed by the individual to their pension fund. However, the level of the State incentive and its interaction with the existing marginal rate of tax relief scheme for occupational pensions was one of the issues that generated much debate in the consultation process.

While the issue of State incentives within wider supplementary pensions is under the remit of the Department of Finance, it formed part of the Interdepartmental Pensions Reform and Taxation Groups (IDPRTG) Consultation on Supplementary Pensions Reform. On the basis of the findings from this review, the responses to the Strawman consultation, and ongoing research and consultation with experts around the world, a set of options on the design of a financial incentive for AE will be brought to Government in the first quarter of 2020.

I hope this clarifies the matter for the Deputy.