'All workers should have pension within five years'
Published 13/09/2016 | 02:30
A universal pension scheme for thousands of workers could be put in place within five years, the industry insists.
Insurance Ireland, the lobby group for investments firms, said there was an urgent need to put a universal pension scheme in place for the six out of 10 private sector workers who do not have one.
This could provide pension coverage for around 600,000 people who are not members of a retirement scheme.
Workers should be automatically enrolled in a scheme, starting at 1pc of their salary in the first year.
This should rise annually to 5pc, with employers matching this, Insurance Ireland said. Contributions from workers could go to 10pc of salary eventually.
The scheme could be implemented in three to five years, said Insurance Ireland chief executive Kevin Thompson, launching a major report outlining how other countries have put in place universal pension schemes.
"Given our demographics and coverage rates, we urgently need a policy approach that maximises participation, achieves simplification of offering and reduces costs.
"In recognising this challenge, we have outlined a horizon of three to five years to implement a universal pension in Ireland that could provide pension coverage to approximately 600,000 workers."
This is in contrast to recent comments from Social Protection Minister Leo Varadkar, who said implementing the new scheme could take up to 10 years, but could move quicker due to the improved economy.
An inter-departmental committee has been studying how to implement a universal pension scheme for almost two years. It was supposed to report at the end of last year.