| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 Asia Economy


How to use our RSS feed

Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.


Finfacts is Ireland's leading business information site and you are in its business news section.

We provide access to live business television and business related videos from: Bloomberg TV; The Wall Street Journal; CNBC and the Financial Times. Click image:


Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax 2008

Climate Change Reports

Global News

Bloomberg News

CNN Money

Cnet Tech News


Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News




Content Management by interactivetools.com.

News : Irish Last Updated: Oct 21, 2009 - 7:46:39 AM

Half of Irish adults under the age of 45 have no occupational pension
By Finfacts Team
Oct 20, 2009 - 3:36:54 PM

Email this article
 Printer friendly page

Half of Irish adults under the age of 45 have no pension or savings in place to provide for their retirement according to research by New Ireland Assurance.

More than a third of those aged between 35 and 44 do not know how they will fund their lifestyle in retirement, the research found - - it has not yet been updated on the company website.

The collapse in equity prices and pension fund values has blown away any confidence people have in investing generally.

The insurance company says a plunge in disposable income due to the economic slump is also making people think twice before putting money into a pension.

New Ireland says that even saving as little as €2 per day, a worker could build up a fund of €126,000 for retirement.

This is based on a 25 year old, with a salary of €30,000, investing €60 a month into a fund that grows at 6% a year.

It is not a simple as that and an average return of 6% over almost 40 years maybe realistic or not.

There is a huge gulf in Irish society with public sector pensions linked with salary increases including productivity payments, while the majority of Irish private sector workers do not even have a basic occupational pension scheme.

The Irish Association of Pension Funds (IAPF) said in its 2008 response to the Government Green Paper on pensions, that the introduction of mandatory or soft mandatory pensions has the potential to undermine the existing system and “cause havoc” for private sector workers.

However, Lord Adair Turner, who headed a UK commission on pensions, said in Dublin in 2006, that a purely voluntary system would not work.

Turner is now the respected head of the UK financial regulator, the Financial Services Authority (FSA),

The more than 1 million private sector workers without occupational pensions contrasts with the exceptional system available for politicians and public sector staff.

Removing barriers rather than imposing compulsion is the best way to address the pensions crisis according to the IAPF.

“We believe the best approach is to increase the number of people with good pensions using simple and proven incentives while ensuring that the Social Welfare Pension is sustainable and delivers a basic standard of living to all,” commented Patrick Burke, chairman, IAPF.

The IAPF said that the introduction of mandatory or soft mandatory pensions has the potential to undermine the existing system and“cause havoc” for private sector workers. “Consumers are already obliged to make mandatory contributions under the State pension scheme,” commented Burke. “The big danger is that an additional mandatory system would set a benchmark below current levels in terms of contributions and benefits.”

Lord Turner who wasn't part of a vested interest, said in Dublin in October 2006 that his Commission on Pensions in the UK had recommended a system which would automatically enrol employees in a pension from the time they began working unless they themselves choose to opt out of the scheme.  This was necessary, he argued, because “a purely voluntary system was not going to work….employers won’t provide adequate pensions for employees and individuals won’t go out and buy pensions themselves.”

It's a debate that is similar to heath care coverage in the US and in Ireland, the Celtic Tiger has come and gone and private sector workers did not have the collective power to get the attention of politicians during the good times.

“Fundamental pension reform can no longer be put on the back burner,” Sinead Pentony, Head of Policy at the think-tank TASC said today.

Pentony said the New Ireland research findings were similar to a TASC / Behaviour & Attitudes survey released earlier this year, which found that just 50% of those in employment had a pension - - significantly below the Government target of 70%.

“As well as being inequitable (disproportionately benefitting those higher up the income scale) and inefficient (having singularly failed to achieve their objective of increasing pension coverage), TASC demonstrated last year that the cost of tax reliefs was set to outstrip the cost of the public pension system,” Pentony said.

“The ‘tax incentive’ approach to increasing coverage is a costly failure. A slightly different version of the same approach – as suggested in the revised Programme for Government - - is also likely to fail.

“The time has come for the Government to grasp the nettle of fundamental pension reform. A significant proportion of Irish workers could face an impoverished retirement unless the current system of tax-incentivised private pension provision is replaced by a state-led system comprising an increased and universalised State pension combined with a Social Insurance earnings-related ‘second-tier’ pension,”
Pentony said.

Finfacts report Feb 2009:  Lenihan says total cost of State pension for an Irish public sector worker hired after 2004 is 26.1% of pay

Related Articles
Related Articles

© Copyright 2009 by Finfacts.com

Top of Page

Latest Headlines
Ryanair revises up full-year profit guidance
AIB bank profitable in third quarter
Ryanair announces half-year profits up 32% to €795m
Ryanair benefits from improved customer service
Ryanair to buy 100 new Boeing 737 MAX 200
Finfacts server migration Thursday
State-owned Allied Irish Banks reports H1 2014 profit as bad loan charges plunge
Ryanair reports profit in its financial first quarter soared 152%
UK firm opens van dealership in Dublin
Ryanair reports 8% fall in full-year profit; US services to commence in 2019
Global Financial Centres Index: New York overtakes London; Dublin slips to 66 of 83 cities
Bank of Ireland reports “significant” improvement in 2013 results
Sale process of IBRC UK projects Rock and Salt completed
CRH says 2014 will be year of profit growth after reporting 2013 loss
Ryanair reports third-quarter loss
Irish Water says it saved €100m in setup costs
RSA Insurance fires two Irish executives for large loss/ accounting irregularities
Bank of Ireland will have to raise provisions by €1.4bn; AIB says it's "well capitalised"
CRH reports slightly improved third quarter
Central Bank says ownership of Newbridge Credit Union transferred to permanent tsb
Ryanair reports H1 profits rose by 1% to €602m
Dublin Web Summit: Irish Stock Exchange and NASDAQ OMX announce dual listing plan
Irish pension managed funds returned to growth during September
Dan O’Brien resigns as economics editor of The Irish Times
Central Bank says no action required on Anglo tapes revelations
Ryanair flew 9m passengers and Aer Lingus carried 1.1m in August
UK Competition Commission says Ryanair must cut Aer Lingus stake to 5%
CRH reports H1 2013 revenue dip and loss
Vodafone refunded UK after discovery of Irish tax haven deal
RBS reports half year profit; Ulster Bank posts reduced loss
Bank of Ireland cuts pretax losses in HI 2013 to €504m
Irish State-owned Allied Irish Banks reports losses of €758m in H1 2013
Service Announcement
Irish managed pension funds declined in June
VHI reports 2012 surplus of €54.3m; Health insurance made loss
Ex- Elan director says management / board "not competent to run a business"
Aer Lingus to put €140m in employees pensions fund; Ryanair apoplectic
Wednesday Newspaper Review - Irish Business News and International Stories - - May 22, 2013
Tuesday Newspaper Review - Irish Business News and International Stories - - May 21, 2013
Ryanair, Europe’s biggest low cost carrier, announced Monday record annual profits of €569m - - up 13%