Liam Quaide (Cork East, Social Democrats)
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284. To ask the Minister for Employment Affairs and Social Protection the plans in place to ensure that upon the introduction of pensions auto-enrolment organisations in the community and voluntary sector that are contracted to deliver services by the State will receive funding within the relevant contract to make the employer contribution required of them; and if he will make a statement on the matter. [22238/25]

Dara Calleary (Mayo, Fianna Fail)
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The new Programme for Government contains a commitment to introduce the Automatic Enrolment (AE) Retirement Savings System. The legislative basis for implementing the new system was enacted last July. The aim of introducing AE is to address the pension coverage gap that exists in Ireland and to provide workers with greater comfort and security regarding their retirement savings.

The new system will be called 'My Future Fund'. It will automatically enrol all employees, aged between 23 and 60 years of age, who are earning €20,000 or above a year (across all employments), and who are not actively contributing to a supplementary pension scheme. Those who fall outside the age and earnings threshold – in other words, those aged between 18 and 22 or between 60 and 66, or who earn below €20,000, will be able to join the new retirement savings system by voluntarily opting in if they wish to do so.

Implementation of 'My Future Fund' is well underway with progress being made across several workstreams including the enactment of the legislation, the roll-out of a comprehensive communications strategy, and the contracting of TCS to administer the scheme. At an advanced stage is the ongoing procurement of investment managers and the recruitment of a senior management team and Board. I recently announced the system will commence from the 1st January 2026.

My Department has been engaging with employers, including those in the community and voluntary sector, since the release of the AE 'strawman' public consultation in 2018. Its impending implementation has also been well-flagged since the enactment of the AE Act in 2024. Therefore, employers have been given a substantial lead-in period to budget appropriately for its introduction, including through budget negotiation with a sponsor where appropriate.

Finally, it is worth mentioning that the design of the AE system provides for phasing in of the contribution rates over a decade. Employees will be required to make initial contributions of 1.5% of gross earnings, rising by 1.5 percentage points every three years until it reaches a maximum contribution rate of 6% in Year 10. These contributions will be matched on a ‘one-for-one’ basis by employer contributions, and 'topped-up' by the State at a rate of €1 for every €3 the employee contributes.

For community and voluntary organisations (and employers more generally), this approach gives very clear certainty as to the rates that will be applicable so as to facilitate the gradual absorption of these labour costs over time.

I hope this clarifies matters for the Deputy.