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THE PENSIONS BOARD

Explore Ireland's multi-pillar pension system, demographic challenges, poverty reduction goals, and initiatives to strengthen state and private pension provisions. Learn about tax relief, demographic projections, and the National Pensions Reserve Fund. Stay informed on budget changes affecting retirement ages and public sector pensions. Join the National Pensions Awareness Campaign for a secure retirement future.

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THE PENSIONS BOARD

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  1. THE PENSIONS BOARD Jerry Moriarty – Head of Investigations and Compliance 2/4/2004

  2. The Irish System • First Pillar • Flat Rate Pension • Second Pillar • Voluntary Occupational Schemes • Third Pillar • Individual pensions

  3. First Pillar • Old Age Contributory, €167.30 per week • Gov. target to increase this to €200 by 2007 • Represents over 31% of average industrial wage • Target of National Pensions Policy Initiative is 34% of average industrial wage • Further non-cash benefits – free travel, TV licence, telephone rental, utility allowances from age 70

  4. Second and Third Pillar • Tax relief on contributions • Investment growth is tax-free • 50% of working population have supplementary pension coverage • Target is to increase this to 70%

  5. Comparisons with other EU members • Lowest population of older people in EU • Only member state with no compulsory income-related provision for majority of workers • Partial pre-financing of public pensions • Actuarial reviews of Social Insurance Fund

  6. DEMOGRAPHICS • Lowest population of older people in EU • 11.2% aged 65 or over • Remains roughly the same until 2013 • 15% in 2021 – 19% in 2031 – 28% in 2056 • Same issue as other countries but happens later

  7. Poverty • Living standards of older people low relative to people under 64 • However, percentage of household headed by person over 65 in consistent poverty has fallen from 12.5% in 1994 to 7.2% in 2000. • Target is to reduce this to 2% in 2007 and, if possible, to eliminate • Only country with no compulsory income related pension provision

  8. Meeting the Challenges • First Pillar • Increase state pension • Reduce reliance on means tested pension • Second and Third Pillar • Increase participation • Personal Retirement Savings Accounts • National Pensions Awareness Campaign

  9. National Pensions Reserve Fund • Launched in April 2002 • Intention to pre-fund public sector pensions and increase in first pillar provision • Cap Exchequer outlays at 6.5% of GNP from 2025 to 2055 (projection is 12.5%) • Proceeds of national telecommunications privatisation and 1% of GNP annually • Commercial mandate, no drawdown until 2025 • Most recent value was approximately €9.5b

  10. Budget 2004 • Increase in minimum normal retirement age for new entrants to public sector • 65 for most new entrants • 55 for police and prison officers • 50 for defence forces • Removal of compulsory retirement age for public sector employees

  11. THE PENSIONS BOARD Jerry Moriarty – Head of Investigations and Compliance 2/4/2004

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