Official figures showing that well under half of workers are making plans for any sort of retirement pension highlights again the challenges facing the Government and the pensions industry as the State’s population ages.
The CSO’s Pension Provision report showed under 47% of people with jobs had a pension, while only 46% of working women had made any provision for their retirement.
The findings are from the large Quarterly National Household Survey for the last three months of 2015, published yesterday.
They show a huge slump from the same period in 2009 when just over half — 51% — of the State’s working population had provided for a pension for their retirement, and 49% of employed women had done so.
The CSO survey covered most types of pension — occupational, personal, and both, it said.
Governments and think tanks across Europe have long warned about the costs and the probability of poverty facing many people of working age when they reach retirement age and will depend on comparatively low level of State pensions for their livelihood.
Policy here has long been to encourage people with jobs to take out a private pension through deferred tax credits.
With just over 14% of workers aged 20 to 24, and 36% of workers between 25 to 34 years, holding a pension, the CSO figures may again reignite the debate about pension provision here.
The CSO said 39% of workers said they could not afford a pension. A 2014 report by the Organisation for Economic and Co-operation and Development (OECD), which had been requested by the then Social Protection Minister Joan Burton, said that compared with other OECD countries, the State’s pensions expenditure “will be comparatively low” even though there were “large projected increases over the next 50 years”.
However, it found “private pension coverage, both in occupational and personal pensions, is uneven and needs to be increased urgently”; that “the existing tax deferral structure in Ireland provides greater incentives for those with high incomes to save for retirement”; that “the Irish legislation regarding the protection of defined benefit (DB) plan members is weak”; and “there is unequal treatment of public and private sector workers due to the prevalence of DB plans in the public sector and DC (defined contribution) plans in the private sector”.
Ciarán Phelan, CEO Irish Brokers Association said the CSO “spelt it out the Government must give attention to the issue of retirement funding, or lack thereof. The State has a duty.”
Source: Irish Examiner