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THE PENSIONS BOARD ROLE IN 2005 ANNE MAHER Chief Executive The Pensions Board Dublin Ireland 24 October 2005.

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Presentation on theme: "THE PENSIONS BOARD ROLE IN 2005 ANNE MAHER Chief Executive The Pensions Board Dublin Ireland 24 October 2005."— Presentation transcript:

1 THE PENSIONS BOARD ROLE IN 2005 ANNE MAHER Chief Executive The Pensions Board Dublin Ireland 24 October 2005

2 2 AGENDA Role of the Pensions Board Major issues in 2005 Funding of Defined Benefit National Pensions Review IORPs Directive National Pensions Awareness Campaign

3 3 ROLE OF THE PENSIONS BOARD Regulation/supervision of occupational pension schemes and PRSAs Advice to Minister for Social and Family Affairs on pension matters generally Development of private pension provision through information and awareness

4 4 FUNDING OF DEFINED BENEFIT Statutory Position Funding Standard: Wind up Extensions for return to full funding since 2003 Reviewed in 2004 Some changes introduced in 2005 Funding Standard still considered an ‘issue’

5 5 FUNDING OF DEFINED BENEFIT 2005 Experience 460 Actuarial Funding Certificates submitted to date in 2005 234 (51%) satisfied Funding Standard covering 56% of members 226 did not satisfy Funding Standard 77 submitted 3 ½ year Funding Proposals Since 2003: 200 have applied for extensions over 3 ½ years 164 have been granted extensions

6 6 NATIONAL PENSIONS REVIEW Statutory requirement to review progress in 2006 Brought forward to 2005 Interim Report to Minister in June Final Report to Minister in October

7 7 NATIONAL PENSIONS REVIEW Scope and main components of Review Review of NPPI strategic recommendations Review of coverage targets Review of current Second Pillar position Options to address coverage and adequacy

8 8 IORPs DIRECTIVE Progress EU Pensions Directive came into force on 23 September 2003 EU Member States required to implement by 23 September 2005 Difficulties with interpretation of some Directive Articles Conference of Insurance and Pension Supervisors (CEIOPS) and its Working Group on Occupational Pensions (WGOP) supervising implementation Some Member States not ready by 23 September Protocol being agreed between pension supervisors on “who does what and when” for cross-border supervision

9 9 IRISH IMPLEMENTATION Statutory Requirements in Social Welfare and Pensions Act, 2005 Underlying Regulations in place by 23 September Associated tax changes introduced in Finance Act, 2005 Approach Implements essentials of Directive No further new supervisory requirements added other than essentials of Directive Areas affected Funding Scheme management Investment Cross-border

10 10 IMPACT ON EXISTING FUNDS Changes (and some increases) in compliance requirements Single employer/single country plan may consider relocation Multinational employer may consider Pooling investments Pooling services Merging plans in single location

11 11 NATIONAL PENSIONS AWARENESS CAMPAIGN Government investing €500,000 for National Pensions Awareness Campaign (NPAC) 2005 Primary objective of NPAC is to heighten pension awareness with view to increasing pension coverage in Ireland Secondary objective is to ensure those with pension provision address adequacy of that provision 2005 campaign moved from awareness to focus on action and responsibility Two high-intensive periods of activity in May and October

12 12 NATIONAL PENSIONS AWARENESS CAMPAIGN In the pursuit of increased pensions uptake focus for NPAC 2005 is on: Low Coverage Sectors  Population aged 25 – 35  Women  Farming/Rural Community  Migrant workers  First time job seekers Graduates/students

13 13 NATIONAL PENSIONS AWARENESS CAMPAIGN The Pensions Board Consumer Awareness Research Audits clearly show a positive increase in pensions and PRSA awareness levels rising from 60% at end of 2003 to over 70% at end of 2004 (Catalyst M.C. – Jan 2005) Pension coverage is increasing. Now 52.4% of workforce and 59.1% of over 30s in workforce (CSO 2004) 87% of Consumer Research sample said State old age pension would NOT meet their needs in retirement (Catalyst M.C. – Jan 2005)

14 14 IN CONCLUSION Compliance has improved Defined Benefit under pressure Greater employer focus and public awareness PRSA progress slow Debate on future pension provision started IORPs Directive may be catalyst for change And Ireland remains better placed than most countries


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