Wednesday 28 April 2021: Today, the Pensions Authority welcomes the transposition of the EU Directive (IORP II) on the activities and supervision of institutions for occupational retirement provision into Irish law.
The Minister for Social Protection, Heather Humphreys, TD, announced yesterday that the regulations to give effect to the transposition of IORP II had been signed and these are available at European Union (Occupational Pension Schemes) Regulations 2021.
IORP II sets minimum standards for the management and supervision of pension schemes in order to protect the entitlements of members and beneficiaries. IORP II introduces many new obligations on Irish pension schemes including:
- minimum qualification and experience standards for trustee boards;
- the appointment of key function holders for risk management, actuarial and internal audit;
- requirement for written policies on risk management, internal audit, remuneration and, where relevant, actuarial and outsourced activities;
- standards for internal controls, administrative and accounting procedures, contingency plans; and
- communications and information to be provided to active members, prospective members, deferred members, those nearing retirement and pensioners.
IORP II also requires the Pensions Authority to adopt a forward-looking and risk-based approach to supervising pension schemes and to intervene where the interests of members are believed to be under threat.
The Pensions Regulator, Brendan Kennedy, said: “It is important to recognise the significance of these changes for Irish pensions. The objective is to improve the outcomes for members of Irish pension schemes, but many schemes will need to do a lot of work to meet the standards and obligations set out in these new provisions.”
Following the transposition of IORP II, the Head of Supervision and Enforcement, Grace Guy, said: “The Authority recognises that trustees and their advisers will need to fully understand their new obligations and the expectations of the Authority. We are reviewing the detail of transposition and will provide further information and guidance over the coming weeks and months as follows:
- An overview of the key themes of transposition including how the Authority will oversee IORP II compliance and the effect of derogations and transitional periods. This will be published in the week commencing 10 May 2021.
- A draft code of practice which will set out what the Authority expects from regulated entities to meet their obligations under IORP II including specific information in relation to defined benefit schemes. This draft code will be open to public consultation for an eight-week period and will be published in the week commencing 19 July 2021.
- A final code of practice on what the Authority expects from regulated entities to meet their obligations under IORP II will be published in the week commencing 15 November 2021.
- Guidance for the public and employers about the minimum standards they should expect from master trust vehicles. This will be published in the week commencing 13 December 2021.
The Authority will continue to communicate on the nature of the changes and monitor developments so as to ensure adequate information is provided to trustees and their advisers.”
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Note to Editors
The Pensions Authority is the statutory body that supervises compliance with the requirements of the Pensions Act, 1990, as amended, by trustees of occupational pension schemes and trust RACs, PRSA providers, registered administrators and employers. The Pensions Authority also provides guidance and information to these stakeholders on their duties and responsibilities and advises the Minister for Social Protection on pension matters. See: www.pensionsauthority.ie