Unions attack Government over pensions scheme

Unions today claimed the Government's apparent scrapping of proposals to make pensions mandatory were a capitulation to big business.

The Irish Congress of Trade Unions accused the Department of Finance of colluding with Ibec to scupper a pension scheme drawn up for Minister for Social and Family Affairs Séamus Brennan.

An estimated 900,000 of Ireland's 2,000,000 strong workforce have no private pension.

Under the Special Savings for Retirement scheme, which was published by the Pensions Board yesterday, there would be a major increase in the State pension alongside mandatory contributions of up to 10 per cent of salary.

It was projected that the scheme could cost the Exchequer up to €3 billion a year.

The proposal has been dismissed by the Department as too costly. Ibec had also opposed the introduction of any mandatory pension system, claiming they would add to the cost of labour.

Ictu president Peter McLoone said compulsory pensions could save tens of thousands of low-paid and women workers from poverty in retirement.

"It's naive to think that solving the potential pensions crisis will be cost-free. This is an attempt by Finance to stifle the debate before people have a chance to understand the cost and benefits of what is being proposed," he said. "They should back off and allow this matter of serious public interest to be considered without spin and propaganda."

Siptu President Jack O'Connor said his union, which represents 260,000 workers, was strongly in favour of making pensions mandatory. "There is no prospect of the pensions' deficit being addressed voluntarily because, unfortunately, there is a large element among employers who will not contribute to pensions on a voluntary basis," he said.

"These employers enjoy an unfair advantage over employers who do contribute to employees' long term welfare and pension provision."

The Green Party today launched a policy document on pensions in which it called for a second tier 'opt out' scheme, regulatory reforms and employment measures to give maximum choice for workers reaching retirement age.

The Greens said they would like to see the Government facilitating employers to employ and retain employees over the age of 65. They also repeated their call for legislation to establish a legal right to flexible working practices.