Brennan considers opt out pension system
The proposal is one step short of mandatory pensions for all which Mr Brennan has already indicated as one way of addressing the fact that just half of those in the labour force have pension cover.
However, with huge resistance expected from employers, the financial sector, unions and advocates for the poor, the introduction of mandatory pensions would prove politically difficult to implement.
The opt out system - otherwise known as soft mandatory pensions - offers a way around that resistance while still addressing the looming pensions time-bomb.
Behavioural research and experience with a similar system in New Zealand indicates that if pension provision happens automatically, most workers will not go to the trouble of opting out.
Speaking to the Irish Examiner yesterday, Mr Brennan indicated he was prepared to abandon mandatory pensions in favour of the opt out approach.
"I think the New Zealand route is probably a halfway house that's worth looking at. I'm not sure how realistic the compulsory one would be," he said.
It is understood the introduction of an opt out scheme here would likely involve the updating of the Pensions Act to broaden the remit of the Pensions Board to include the management of the new scheme.
Speaking at the launch of the Pension Ombudsman's first annual report in Dublin yesterday, Mr Brennan said he had specifically asked the Pensions Board to include an assessment of the opt out system in a major pensions strategy report due in the coming weeks.
Following publication of the report, and the ensuing debate, the Government will make a final decision on what action to take.
Meanwhile, Pensions Ombudsman Paul Kenny yesterday warned builders who keep pension contributions owed to their workers will face prosecution.
As first revealed by the Irish Examiner, the industry's mandatory pension scheme - the Construction Federation Operatives Pension Scheme (CFOPS) - suffers from huge non-compliance with many thousands of workers being ripped off by employers.
Outlining numerous complaints against employers in the scheme, Mr Kenny said it was "one of his best customers" since there was evidence "of systematic non-compliance by certain companies".
In all, the ombudsman dealt with 450 cases of all types in the past year.
Although 23 determinations were made, only seven complaints were upheld. But the ombudsman also solved 33 cases by mediation, with 22 of these resulting in compensation to the complainant.
