Insurance Ireland Welcomes Taoiseach’s Plan for an Auto-enrolment Pension Scheme
· Drawing on international experience can help maximise participation, increase savings rates and reduce complexity
· Universal pensions are a key policy tool to help individuals and families plan for retirement
Issued 22 September 2017. Insurance Ireland has welcomed the announcement by An Taoiseach Leo Varadkar TD of his plans to introduce an auto-enrolment pension scheme for private sector workers, two-thirds of whom currently have no occupational pension.
In 2013, a Government-commissioned OECD review of the Irish pension system recommended the establishment of a universal defined-contribution pension model for Ireland that would ultimately cover all Irish workers. It has been estimated that a universal pension model could extend coverage to approximately 600,000 workers*.
Given our savings rates, demographics and the increasing number of people who will rely solely on the state pension, a universal pension model is a key policy tool to increase pension coverage and help people plan for their retirement.
To consider how to implement such a model here, in 2015 and 2016, Insurance Ireland undertook a series of policy workshops to analyse the experiences of comparable countries which have introduced universal pensions, including Australia and New Zealand. Insurance Ireland’s work considered the fundamentals of universal pension models and it resulted in the publication of A Universal Pension for Ireland.
Kevin Thompson, CEO of Insurance Ireland stated, “The international experience is clear that the introduction of universal pension models such as auto-enrolment increase pension coverage. To successfully implement such a scheme in Ireland, it is important to consider the experiences of other countries to maximise participation, increase savings rates and reduce complexity. This is vital to implement a pension policy that can help individuals and families in Ireland plan for retirement.”
Kevin concluded, “The Taoiseach’s statement is welcome in the context of having a public conversation on pension coverage and Insurance Ireland looks forward to hearing further details about the policy.”
Notes to Editors:
· In 2013, a Government-commissioned OECD Review of the Irish Pension System recommended the establishment of a universal defined-contribution pension model for Ireland that would ultimately cover all Irish workers
· The 2016 report, A Universal Pension for Ireland can be accessed at: http://www.insuranceireland.eu/media/A%20Universal%20Pension%20for%20Ireland.pdf
· The report looked at Universal Pensions models such as those in New Zealand, Australia, The UK, The United States, The Netherlands and Chile to identify which aspects of each can be deployed to meet Irish policy requirements
· The report focuses on the key issues of Governance, Product Design, Investment, Retirement/Decumulation, Administration and Simplification.
· *McKinsey estimated that 600,000 private sector works would be targeted in a universal model
· As the Voice of Insurance in Ireland, Insurance Ireland members manage €82.4bn in pension assets on behalf of over 1m Irish workers and provides the benefits of a leading-edge Defined Contribution infrastructure.
Communications Manager, Insurance Ireland
Tel: 01 644 7781 / 087 9383852
Q4 Public Relations
Tel: 01 475 1444 / 085 174 4275