I am pleased that the Government recently approved significant elements of my design for an automatic enrolment retirement savings system. These include key decisions in relation to the target membership, the contribution rates, the policies in relation to opting-out and re-enrolment, the administrative arrangements and organisational approach and the investment options.
As stated in the 'The Roadmap for Pensions Reform', the Government proposes to begin implementation of a supplementary retirement savings system, known as Automatic Enrolment (AE), by 2022. AE will see a transition from the current and purely voluntary system to one which will, subject to certain parameters, automatically enrol employees into a quality assured retirement savings system. The saver will maintain the freedom of choice to opt-out.
There are five main areas where work is on-going so as to produce design options for Government to consider. These areas relate to the design of: the State financial incentive; the scope and role of the Central Processing Authority; the nature and functions of the Registered Providers; the investment framework and funds to be offered by Registered Providers, including the design of the default fund, and also the pay-out phase; and the phasing of implementation.
Given the low level of occupational pension coverage we continue to work towards the 2022 target with the required legislation commencing in 2020.
I hope this clarifies the matter for the Deputy.