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By Susanna Rust2021-04-29T14:36:00+01:00
The IORP II Directive, the EU’s pension fund legislation, has been transposed into Irish law – more than two years after the intended deadline.
The development was announced by the government on Tuesday, which said that the general principle in respect of the transposition was that ”the requirements of the Directive will apply to all schemes and trust Retirement Annuity Contracts (RACs), including small schemes and one-member arrangements, where possible and as appropriate, in order to ensure that all members and beneficiaries are afforded equal protection irrespective of size”.
Heather Humphreys, minister for social protection, said many of the provisions in the IORP II Directive would support positive reform of the Irish occupational pension sector, in keeping with the government’s plans.
Pension entitlements, or what will have to be paid out when members of schemes give up work, worked out at €80.5bn for defined benefit pension funds.
The entitlements for defined contribution pension funds was €42.5bn at the end of the third quarter last year.
Jerry Moriarty of the Irish Association of Pension Funds said it was good to see an increase in assets.
He said that pensions were long-term investments which means people should not dwell on how investments perform from one quarter to another, unless they are very close to retirement.
The figures do not take account of pay-as-you-go public sector pensions where there is no fund in place to pay the retirement incomes.
By Gail Moss2021-02-17T14:00:00+00:00
Irish pension funds are reluctant to make the changes needed to comply with IORP II before it is transposed into Irish law, according to a Pensions Authority survey.
While there is a general level of awareness of the directive among trustees, there is also a widespread belief that new legislation will increase cost, time and resources, while proportionality is also a concern for schemes of all sizes, the regulator relayed.
The Pensions Authority contacted trustees of 100 defined benefit (DB) and 100 defined contribution (DC) schemes last November. Schemes of varying sizes were chosen randomly from the register of occupational pension schemes.
A public servant with a full 40 years of service will retire on an annual pension equivalent to half of their salary and a tax-free lump sum of one-and-a-half times their annual pay.
The statisticians have calculated the amount of money owed to households by private employers and the Government on all occupational pension schemes, the so-called liabilities of these schemes.
The CSO said the total liabilities of occupational pension schemes in Ireland were estimated at 186pc of Gross Domestic Product (GDP).
The total liability equated to a staggering €607.9bn, when the State pension, private sector pensions and public sector pensions are added together.