Vol. 431 No. 3
106 Mr. Callely asked the Minister for Social Welfare the regulations or guidelines, if any, that exist in relation to the way in which pension funds are invested; if certain categories or values exist; and if he will make a statement on the matter.
The Pensions Act (No. 25 of 1990) which I introduced in 1990 provides for a wide range of measures to protect members of occupational pension schemes. The Act sets out the duties and responsibilities of trustees who are charged with the responsibility of looking after members' interests. Trustees of funded pension schemes are required to properly invest the resources of the scheme to secure member's pension rights.
The funding standard set out in the Pensions Act is designed to protect members' interests ensuring that, at a minimum, the scheme has sufficient funds to secure the pension rights members have built up. Trustees must demonstrate the level of a scheme's funding to the Pensions Board through the submission of an actuarial funding certificate, signed by an actuary, at least every three and a half years.
The legislation requires that investment of the scheme's assets in the employer's business, or in any one shareholding or property, which exceeds 20 per cent, cannot be taken into account for the purpose of meeting the standard.
Furthermore, trustees are required to disclose to members of schemes any such investment which exceeds 5 per cent of the scheme's assets.
The Pensions Board which I set up to supervise the implementation of the Act monitors the situation in relation to the investment powers of trustees and keeps them under review in the light of developments in pensions investment generally. The Board also advises me where change is necessary.
Arising from the Budget Statement of the Minister for Finance, discussions are taking place with representatives of Irish Pension Funds with a view to investment by funds in job-creating projects in Ireland. The Irish Association of Pension Funds have accepted in principle the Minister for Finance's proposals and discussions are continuing.
