Pearse Doherty
Ceist:50. Deputy Pearse Doherty asked the Minister for Finance if he will outline the steps to be taken by the National Asset Management Agency to get its first Qualifying Investor Fund operational. [48912/12]
Amharc ar fhreagraNAMA Qualifying Investor Fund
Ceisteanna (50)
Freagraí scríofa
The National Asset Management Agency advises that it is acting as Promoter of the QIF and is taking all necessary steps towards obtaining regulatory approval for the QIF. The Deputy may wish to consider the Central Bank Guidance Note 2/96 - Promoters of Collective Investment Schemes for information about the role and responsibility of the Promoter.
NAMA Qualifying Investor Fund
Ceisteanna (51)
Pearse Doherty
Ceist:51. Deputy Pearse Doherty asked the Minister for Finance if he will quantify the number of persons who will comprise the board of the first qualified investor fund to be operated by the National Asset Management Agency and the way these persons will be selected for board membership and the remuneration that will attach to such positions.; and if he will make a statement on the matter. [48914/12]
Amharc ar fhreagraFreagraí scríofa
I am advised that regulatory requirements stipulate that the Board must comprise a minimum of three suitably qualified directors. The National Asset Management Agency proposes to nominate one director. It is envisaged that the investment manager to the QIF will appoint one director and subsequent directors will be appointed by the QIF once it has been incorporated. The remuneration of persons appointed to the Board of the QIF will be determined by the Board once constituted.
Tax Reliefs Availability
Ceisteanna (52)
Dominic Hannigan
Ceist:52. Deputy Dominic Hannigan asked the Minister for Finance if tax reliefs are being examined as a part of the Budget proposals for 2013; and if he will make a statement on the matter. [48984/12]
Amharc ar fhreagraFreagraí scríofa
Tax reliefs are kept under continuous review. However, as the Deputy will be aware, it would not be appropriate for me to comment in advance on possible Budget decisions.
Pension Provisions
Ceisteanna (53)
Bernard Durkan
Ceist:53. Deputy Bernard J. Durkan asked the Minister for Finance further to Parliamentary Question No. 95 of 25 September 2012, if it is possible for a person (details supplied) in County Kildare to obtain access to the full amount under the terms of approved minimum retirement fund or part thereof with an insurance company ; if it is possible to review the terms governing the operation and management of the investment in view of their changed economic circumstances; and if he will make a statement on the matter. [49025/12]
Amharc ar fhreagraFreagraí scríofa
An Approved Minimum Retirement Fund (AMRF) is established where a person, who would otherwise be eligible to take retirement benefits from a pension arrangement in the form of either a taxable lump sum payment or investment in an Approved Retirement Fund (ARF), is unable to satisfy the “specified minimum income” requirement.
The “specified minimum income” requirement is a requirement that the person be in receipt of a guaranteed income for life of 1.5 times the annual rate of the State (Contributory) Pension, currently €18,000 per annum. Where the “specified minimum income” requirement is not met and if the person decides not to purchase an annuity, he/she, as an alternative, can invest in an AMRF. The “specified income requirement” applies to all AMRF holders
The capital amount that must be invested in an AMRF is 10 times the annual rate of the State (Contributory) Pension, currently €119,800 or, if lower, the balance of the pension fund after the person concerned has taken his/her permitted tax-free lump sum payment.
Unlike an ARF, only income growth in excess of the original capital investment may be withdrawn from an AMRF.
An AMRF converts into an ARF once the AMRF holder reaches the age of 75 years or he/she satisfies the “specified minimum income” requirement, at which point withdrawals of the capital may be made from the ARF (that is, the converted AMRF).
It is important to bear in mind that the capital in an AMRF may be used, at any time, to purchase an annuity that would be payable for the duration of the person’s life but the capital in the AMRF is not otherwise available to the beneficial owner of the AMRF. The reason for this is because the AMRF fund is designed to meet the income requirements in the latter part of a person’s life (that is, from the age 75 onwards) in a situation where that person does not have alternative income source/s of an amount that equates to 1.5 times the rate of the State (Contributory) Pension.
In my reply to the previous question referred to by the Deputy, I outlined in considerable detail the changes made to provide flexible options at retirement for individuals in Defined Contribution pension arrangements, including the rationale for the “specified minimum income” requirement and the approved minimum retirement fund (AMRF) outlined above. I also outlined the changes made in Finance Act 2011 to extend the flexible options and to modify the conditions relating thereto.
I understand from the Revenue Commissioners that the person referred to in the details supplied with this question took out his AMRF a little over a year ago and after the Finance Act 2011 changes but presumably in the knowledge of the conditions attaching to investment in such a fund.
At this point, the only immediate option open to the person concerned to access the capital in the AMRF (based on the information available) would be to use the funds to purchase a pension annuity. He would not be obliged to use all of the funds in the AMRF for this purpose unless he decided to do so and any lifetime pension annuity would count (together with any State Pension Contributory to which the person may be entitled in the future) towards meeting the “specified minimum income” requirement which, if or when satisfied, would allow any remaining AMRF funds to be converted to an Approved Retirement Fund (ARF) with unfettered access to the capital before age 75, subject to taxation.
I have no plans to adjust the “specified minimum income” requirement at this time. However, I have received a number of representations about the scale and timing of the increase in the requirement introduced in Finance Act 2011 and I will examine these matters again without prejudice in the context of next year’s Finance Bill.