Pensions Board says fines have led to increased compliance

THE PENSIONS Board took four enforcement actions last year and issued 16 fines to employers and trustees of pension schemes.

At the launch of the Pensions Board's annual report, chief executive Brendan Kennedy said although the fine system was only introduced last September, "it has definitely increased compliance".

Fines of €2,000 per offence can be issued to an individual trustee of a pension scheme that fails to comply with Pensions Board rules.

The board sought the introduction of a fine system as an alternative to going to court for less serious infringements of the Pensions Act.

The four prosecutions concerned employers who had failed to respond to requests for information about their PRSA obligations.

Minister for Social and Family Affairs Mary Hanafin admitted that the growth in the number of people contributing to a pension was "not at a rate which would suggest we can reach coverage targets within [a] reasonable timescale".

The National Pensions Review recommended that 70 per cent of people aged over 30 hold a pension, but Mr Kennedy said the current level is around 62 per cent.

The Pensions Board's report shows that almost 800,400 people belong to an occupational pension scheme, an increase of almost 3 per cent on 2006. Schemes regulated by the board hold approximately €80 billion of assets.

530,933 people are members of 1,411 defined-benefit schemes registered with the board. Just less than 270,000 are members of a defined-contribution scheme.

The number of PRSAs at the end of 2007 was 130,709, more than three-quarters of which were standard contracts. The value of these assets was €1.25 billion. More than 84,550 employers have signed up with a PRSA provider and 45,243 employees had taken one by the end of last year.

On a day when shares on the Dublin market were under pressure, Mr Kennedy said the message for investors was to be aware of risk, not just potential savings.