Pension reform navigates slowly on old roadmap

Cantillon: 13 years since urgent call for ‘full review of pension coverage’

Pension reform: little detail beyond idea employee, employer and State shall all contribute financially. It will be introduced in 2022.

Pension reform: little detail beyond idea employee, employer and State shall all contribute financially. It will be introduced in 2022.

 

It was a crowded platform when the new roadmap for pensions reform was announced on Wednesday. Taoiseach Leo Varadkar and Minister for Finance and Public Expenditure and Reform Paschal Donohoe were ranged alongside Regina Doherty, the Minister for Employment Affairs and Social Protection.

But there was still space for Benjamin Franklin, with the Taoiseach turning to the eminently quotable writer to make the point that we should not put off till tomorrow what can be done today.

“Important decisions delayed don’t get any easier,” the Taoiseach said, adding that the new roadmap meant the Government was now “planning for all our futures”.

All of which is rather ironic when you consider that it is over 13 years since former minister Séamus Brennan commissioned the regulator – then called the Pensions Board – to “undertake a full review of pension coverage and associated issues without delay”.

There have been six officeholders over the intervening years – including the Taoiseach – and myriad reviews, forums and other gatherings to examine how best to fix and futureproof the Irish pensions landscape.

Retirement income

And in all that time, the issues have been the same – how to balance the State and private provision of retirement income, and how to improve the very low rate of pension saving among private sector employees.

One of the fairly obvious answers – a centrepiece of the new roadmap – was also evident even to Brennan back in 2006. He refused to countenance reform that did not consider auto-enrolment.

Electoral calculations and the financial crisis have ensured that no minister put flesh on the bones of such a proposal – even as its introduction in many other countries meant it was no longer the radical option it first appeared to be.

Now it falls to Doherty and her colleagues in Government. So far, there is little detail beyond the general principle that the employee, the employer and the State shall all contribute in some form financially. And that it will be introduced in 2022.

Of course, that takes us well beyond the next general election. And we all know the risks that poses. We can only hope that talk finally progresses to action.