Brian O'Shea
Ceist:87 Mr. O'Shea asked the Minister for Social, Community and Family Affairs if he will make a statement on the progress made to date in implementing the recommendations on the National Pensions Policy Initiative. [2600/99]
Written Answers - Pension Policy Initiative.
Seán Ryan
Ceist:94 Mr. S. Ryan asked the Minister for Social, Community and Family Affairs the work he has carried out in implementing the report by the Pensions Board; and if he will make a statement on the matter. [2625/99]
Pat Rabbitte
Ceist:116 Mr. Rabbitte asked the Minister for Social, Community and Family Affairs the way in which he is progressing the National Pensions Policy Initiative and the Securing Retirement Income report of 1998. [2608/99]
I propose to take Questions Nos. 87, 94 and 116 together.
The Pensions Board report, Securing Retirement Income, on the national pensions policy initiative is a comprehensive and detailed document.
The Government broadly welcomed the thrust and recommendations of the report as set out in its response, Action on Pensions, published when the report was launched in May 1998. To progress the main recommendations made by the Pensions Board in the report, working groups have been set up as follows:–
(a)to examine fully the recommendation for an explicit mechanism to fund, at least partially, the substantial future costs of social welfare pensions. This group is chaired by the Department of Finance and I understand that it hopes to report before mid year;
(b)to progress the recommendation to increase Second Pillar coverage and the mechanism suggested for achieving this – namely, the personal retirement savings accounts PRSAs. The Government has accepted this recommendation, in principle and the working group, which is chaired by my own Department, is currently examining the issues involved;
(c)to further examine and advance the proposals to introduce a simplified and more flexible tax regime for pensions. Again, this was accepted, in principle, by the Government and the third working group, which is chaired by the Department of Finance, is considering this matter with a view to making the necessary legislative changes. This group is also examining issues relating to annuity purchase and the question of an earnings cap in relation to tax relief on pensions; and
(d)to bring forward proposals in relation to an effective awareness/education programme. Again, the Government is supportive of the proposals in this regard. The importance of clear and easily understandable information in the pensions area cannot be underestimated. I understand that an initial report on this from the Pensions Board will be submitted to me shortly. Each of the above groups comprises representatives of the relevant Government Departments and the Executive of the Pensions Board.
The Government also accepted the board's proposals for legislative changes regarding occupational pensions in relation to access, vesting, preservation and revaluation.
I hope to bring forward a comprehensive Pensions Bill later this year dealing among other things with these issues and incorporating the recommendations of the various working groups, with a view to enactment during 2000.
The Pensions Board report also recommended that social welfare pensions be increased over a five to ten year period and building on the Government's commitment, to 34 per cent of average industrial earnings. In this regard, I would remind the House that the Government, as a key priority of its action programme for older people, is committed to increasing the old age pension to £100 per week by 2002. Budget '99 delivered increases of over 7 per cent in personal pension rates – well above the predicted, average inflation rate and, when taken together with the improvements in Budget '98, represents a 14 per cent increase since this Government came into office.