Vol. 500 No. 7
337 Mr. R. Bruton asked the Minister for Social, Community and Family Affairs the plans, if any, there are to introduce incentives or compelling rules to require employers to establish pension schemes; and if he will make a statement on the matter. [4803/99]
Essentially, occupational pension arrangements are a matter between employers and employees and, as such, there is no legal requirement on employers to provide a pension scheme for their employees. As far as employees and employers are concerned, the PRSI system is the major mandatory element in relation to pensions coverage.
However, the main recommendations of the pensions board report, "Securing Retirement Income", arising out of the national pensions policy initiative, involve the development of strong first pillar, social welfare pensions, based on social insurance, and major improvements in our second pillar, occupational and personal pensions, with the ultimate objective of increasing the number of people at work with supplementary pensions coverage to 70 per cent from less than 50 per cent currently.
In the context of achieving this coverage target, the board addressed the issue of compulsory second pillar provisions. A considered approach was deemed appropriate, balancing the risks and costs of compulsion with the practical constraints involved.
In the short-term, the board recommended introducing mandatory provision of access by employers to secondary pensions coverage for all employees. While other options were examined, namely mandatory contributions by employees, the self-employed and employers; the board felt that these should be held in reserve pending a progress review of the first measure after five years of implementation.
The Government broadly accepted the approach taken by the board and I hope to publish a comprehensive pensions Bill later this year giving legislative effect to many of its recommendations.
