Thursday 14 November 2019

Strong support for mandatory pension scheme

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Charlie Weston

Charlie Weston

A large majority of PAYE taxpayers are in favour of a new automatic pension scheme being introduced for those who have no occupational pension.

The survey from tax specialists found that 84pc of people would be in favour of an auto-enrolment type scheme.

The Government has plans to bring in this type of scheme, with the Taoiseach recently telling the Dáil he intends to bring forward proposals for an auto-enrolment scheme. But he gave no time frame for this.

Auto-enrolment involves people being automatically signed up to a pension scheme and having to actively opt out of such an arrangement.

Only a third of private sector workers have a pension. This means an estimated one million workers will only have the State pension when they retire as they have no occupational scheme in place.

A study of the pension systems in this country, carried out by the Organisation for Economic Co-operation and Development in 2014, commissioned by the Government, recommended an auto-enrolment system.

The survey found most people here would be in favour of an auto-enrolment similar to the one in Australia.

That scheme sees 9.5pc of a worker's salary contributed by their employer into a retirement fund.

The survey was conducted among 800 of the tax firm's clients, and its findings are in line with other polls on the same subject.

Auto-enrolment was introduced in the UK in 2012. By the end of March last year, more than 6.1 million workers had been enrolled, an increase of nearly one million on a year earlier.

Barry Flanagan, of, said: "The results were pretty definitive - there would be widespread acceptance of a compulsory pension savings scheme in Ireland, though there may be some issues to iron out surrounding contribution rates."

A spokeswoman for Social Protection Minister Regina Doherty said it is intended in the coming months to publish and commence an action plan for pension reform, which will include a time frame.

Irish Independent

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