'No consensus' on pension reform

THERE IS “absolutely no consensus” among the more than 250 submissions received as part of the Government’s consultation on the future of pensions policy, Minister for Social and Family Affairs Mary Hanafin told delegates at a conference yesterday.

“While there is a general acceptance that action is required in relation to our pensions system, there is no clear consensus on the extent of the reform required, or the manner in which any reforms should be delivered,” Ms Hanafin said at the “Learning from International Experience” event at Dublin Castle, organised as part of the consultation process.

Ms Hanafin acknowledged that given the lack of agreement on the key issues, “striking the appropriate balance between all the competing interests will be a difficult task”, but reiterated her commitment to bringing the process to a conclusion by the end of the year with Government agreement on a new framework for future policy on all aspects of the pensions system.

“A new Minister does not mean a delay,” she told the audience, although she did concede that it will “probably take a couple of years” before the regime is implemented.

Responding to complaints that the consultation process, which began last October, was too long, Ms Hanafin said that the time allowed for lots of people to formulate their ideas and comments. The Department of Social and Family Affairs has to date received more than 250 submissions on the Green Paper, which sets out the background to the Irish pension system, with submissions still being received right up to the deadline of May 31st.

Giving an insight into the content of the submissions, Dr Orlaigh Quinn, a principal in the pensions policy unit at the Department of Social and Family Affairs, said a recurring theme was a strong emphasis on the role of the State and a criticism of the security of private pensions.

Other issues raised included the backdating of credits for homemakers and the current tax relief system, which was deemed by many to be unfair, with greater benefits going to higher earners. As a solution, either a reduction in relief to the standard rate or the provision of relief for all at the higher rate was called for.

Dr Quinn said many of the submissions expressed the desire for people to work after retirement. In its submission, the Society of Actuaries in Ireland recommended that the State pension age should be increased gradually to take into account increasing life expectancy and to offset some of the additional costs that would arise if the level of State pension were increased.