Pension fund managers fail to keep record of payments
Published 18/02/2011 | 05:00
A PROBE by the pensions regulator has found that some administrators of retirement schemes are not keeping proper records of payments made by workers, while other vital details were missing.
The Pensions Board findings mean those retiring are not getting all their options outlined when they come to retire.
Administrators of schemes, who manage the day-to-day affairs of a pension, were found to be issuing letters to those retiring with information missing. This resulted in the wrong information being given on "the amount of benefit payable on retirement".
Also uncovered were messy records showing that people had left a pension scheme when they had actually moved inside the same company.
Administrators, who have had to be registered with the Pensions Board since 2008, were warned they need to properly document pensions payments.
A spokesman for the Pensions Board insisted last night that scheme members have not lost out on pensions benefits because of the poor record keeping. He explained that there are 185 registered administrators and the board was generally happy with overall level of compliance.
Meanwhile, a new survey by consultants PwC has found a majority of workers and employers will give up paying into a pension if the tax reliefs are cut for those on the higher rate of tax, as outlined in the Four-Year Plan.
The survey found that changes introduced in the last Budget have already made most employers less keen on providing pension benefits to workers.
In the December Budget employers no longer get full relief from Pay Related Social Insurance (PRSI) payments when making payments into a pension for an employee.
For employees, the universal social charge (USC) and PRSI payments are now deducted before contributions go into a pension. This means it costs an additional €8 for every €100 put into a pension for workers.
The PwC survey found that four out of 10 employers have made changes to their pension arrangements recently in a bid to cut employer contributions.
Six out of 10 employers were concerned that their employees would not be able to afford to retire at the expected retirement date.