Seán Sherlock (Cork East, Labour) | Oireachtas source

I move amendment No. 22:

In page 42, line 22, to delete “years 7 to 9” and substitute “years 4 to 6”.

I will be brief, as I do not want to spend too much time going over a Committee Stage argument, but I read the Minister's reply to that debate. I will quote from it. She stated:

In any event the employer and employee contribution rates will only increase from 3% to 4.5% in year 7, whereas contribution rates in employment-based schemes are generally at the 5% level for both employers and employees. The issue will not kick in until the AE levels are at a higher level. There is going to be a huge amount of work in defining the standards. It is not just a matter of looking at the contribution rate.

She also stated:

There is a good bit of stuff here. We looked at it and felt that at the end of year 6, at the latest, and we could do it sooner – I am happy that we could look at it sooner – but at the end of year 6 at the latest is the best time to do it because the contributions will have ramped up at that stage.

I accept this position in the main, but the Minister and her officials will have read with interest a recent front page article in the business section of a national newspaper under the headline, "Companies looking to sidestep auto-enrolment by using existing pension schemes". That was The Irish Times on 10 May. We should not be naive. There will be employers looking to avoid auto-enrolment in ways that may or may not fulfil the requirements of this Bill and may or may not be as favourable to employees. We acknowledge that the authority will need time to draw up and apply standards to occupational and private pension contributions for exempt employments because it is not as simple as comparing like with like, but how does allowing up to seven years to define standards meet the Government's overarching policy objective of auto-enrolment, which is about improving the adequacy of pensions and incomes at retirement? This is where we take issue. Will the Minister expand again on how she and her officials arrived at the decision that up to the end of year 6 is needed for the work required to define the standards? Was the Pensions Authority consulted, what was its expert opinion on the matter and will the Minister make that opinion available to us?

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