Richard Bruton
Question:170 Mr. R. Bruton asked the Minister for Finance the annual payment made into the national pension fund by the Exchequer; and the date on which the payments were made since the fund was first established. [18430/02]
Written Answers. - National Pensions Reserve Fund.
Richard Bruton
Question:171 Mr. R. Bruton asked the Minister for Finance the value of the national pension fund at the end of each year since it was established; and the present value of the fund. [18431/02]
Richard Bruton
Question:172 Mr. R. Bruton asked the Minister for Finance the index of the performance of the investments made by the pension fund he receives; and the details of investments of this index at the end of each quarter since the fund was established. [18432/02]
Richard Bruton
Question:173 Mr. R. Bruton asked the Minister for Finance the details of the portfolio of investments currently held by the national pension fund. [18433/02]
Denis Naughten
Question:175 Mr. Naughten asked the Minister for Finance further to Parliamentary Question No. 451 of 9 October 2002, the total moneys paid to date into the NPRF; the value of the fund at present; the loss to date since its establishment; and if he will make a statement on the matter. [18539/02]
I propose to take Questions Nos. 170 to 173, inclusive, and 175 together.
Section 18 (2) of the National Pensions Reserve Fund Act, 2000 provides that each year there shall be paid into the national pensions reserve fund, in equal quarterly instalments, a sum equivalent to 1% of GNP.
The national pensions reserve fund was established on 2 April 2001 with €6,515 million being allocated to the fund. This sum comprised the net proceeds of the sale of the former Telecom Éireann and 1% of GNP in 1999 and 2000 as well as interest earned on same.
A total of €972 million, representing the 1% of GNP contribution was paid into the fund in 2001. The first three quarterly payments of 2002, amounting to some €775 million, have already been made this year and the fourth payment of €258 million will be made in December. Thus, to the end of September 2002, total payments into the fund amounted to €8,262 million.
The fund is managed by commissioners who are independent of Government. They control and manage the fund with discretionary authority to determine and implement an investment strategy for the fund. This investment strategy is based on a commercial investment mandate with the objective of securing the optimal return over the long-term, having regard to (a) the purpose of the fund as set out in section 18 (1) of the Act, and (b) the payment requirements of the fund as provided for under section 20, provided the level of risk to the moneys held or invested is acceptable to the commission.
In this regard, the commission's report stated that the fund would be invested 80% in equities and 20% in bonds. As the investment strategy is designed with long-term returns in mind, short-term losses which may never be realised cannot be taken as an indicator of fund performance. The commission is required by law to submit to me an annual report and the next such report is due around mid-2003. At the end of 2001, the total value of moneys standing to the credit of the fund was €7,715 million which included interest earned on the contributions to date. According to the 2001 annual report submitted to me by the commission, the fund earned a return of 3.27% for the period to 31 December 2001 compared to a short-term benchmark return of 3.24%, and a long-term benchmark return of 3.5%.
A table detailing contributions to the national Pensions Reserve Fund is provided as follows:
Temporary Holding Fund for Superannuation Liabilities
|
€m |
|||
|
December 1999Net Transfer from Proceeds of Sale of Telecom Éireann |
4,528 |
||
|
December 19991% of GNP |
739 |
||
|
September 20001% of GNP |
890 |
||
|
Interest Earned by Temporary Holding Fund for Superannuation Liabilities |
358 |
||
|
April 2001Transfer to National Pensions Reserve Fund |
6,515 |
||
|
GNP Contributions for 2001 |
|||
|
May 20010.25% of GNP |
243 |
||
|
June 20010.25% of GNP |
243 |
||
|
September 20010.25% of GNP |
243 |
||
|
November 20010.25% of GNP |
243 |
972 |
|
|
Interest Earned by National Pensions Reserve Fund (net of expenses) |
228 |
||
|
Valuation of National Pensions Reserve Fund31 December 2001 |
7,715 |
||
|
GNP Contributions for 2002 to date |
|||
|
May 20020.25% of GNP |
258 |
||
|
June 20020.25% of GNP |
258 |
||
|
September 20020.25% of GNP |
259 |
775 |