Dáil Éireann Debate, Tuesday - 23 March 2010
199 Deputy Olivia Mitchell asked the Minister for Finance his policy in respect of the requirement of persons on defined contribution pension schemes to purchase an annuity; and his views on extending the period permitted for the purchase of an approved retirement funds for new retirees to December 2010 in view of the poor value of annuities in the current economic climate. [12371/10]
Amharc ar fhreagraThe Deputy may be aware that in December 2008 I introduced an option for members of Defined Contribution occupational pension schemes to defer the purchase of a retirement annuity with their pension funds for a 2 year period.
Under the arrangements in place up to that time, PAYE taxpayers who were members of such schemes were obliged to purchase an annuity with their main pension fund immediately on retirement after taking their tax-free lump sum. I introduced the deferral period (which applies until the end of this year) because of the difficulties facing members of Defined Contribution schemes whose pension funds had been badly affected by significant falls in equity markets and in asset values at that time. As outlined in the recently published National Pensions Framework, the Government has decided to extend to members of Defined Contribution occupational pension schemes from next year, the option to avail of an Approved Retirement Fund (ARF) at retirement, as an alternative to annuity purchase.
