Cabinet set to discuss pension scheme proposals

Moves to ensure workers take out supplementary pensions schemes were set to be discussed at the first Cabinet meeting of the year today.

Social Protection Minister Joan Burton was bringing a memo to colleagues outlining the timeframe for the introduction of a new, universal pension saving scheme intended to end sole reliance on State benefits in old age.

The Tánaiste is concerned about low rates of pension boost schemes, especially among lower-paid workers, and is seeking to establish a working group to hammer out details of any initiative.

Ms Burton has previously said she favours an auto-enrolment scheme, where workers would automatically be signed-up for a scheme, but could leave at a later point if they wished.

However, she believes wage pressure on workers means such a reform would have to come after a long lead-up period when the economy is back in robust health.

The Tánaiste says such a move is needed as only half of Irish workers have occupation or supplementary pension coverage. This figure drops to just 41% in the private sector, when public workers are excluded.

The Tánaiste has said the opt-out approach, where workers have to choose to leave, is the most efficient way of ensuring the maximum numbers participate in the bonus scheme, in line with a Programme for Government commitment to bring about reform.

The Universal Retirement Savings Development Group Ms Burton intends to establish would include representatives of several Government departments as well as the Revenue Commissioners, National Treasury Management Agency, Central Bank, Pensions Authority, and international experts.

The Cabinet is also to discuss the terms of reference for the inquiry into mother and baby homes after the exposure of a mass grave in the grounds of a former residence in Tuam, Co Galway.