Pensions Board launches 2004 Annual Report

Tuesday 12 July 2005: The Pensions Board today launched its 2004 Annual Report and presented a copy of the Report to the Minister for Social and Family Affairs, Seamus Brennan TD, which is available on www.pensionsboard.ie.

Michael McNulty, Chairperson of the Pensions Board said: “2004 was a challenging year with major policy and operational matters to be addressed. Our two main policy priorities for 2004 were to complete our review of the Funding Standard to apply in the longer-term and to bring forward proposals for implementation of the EU Pensions Directive. I am happy to report that those objectives were met by the end of last year. 2005 is the last year of the current Board and the dominant policy issue for this year will be completion of the National Pensions Review. The review is well underway and will be completed in late summer. We believe that it will be a balanced and constructive contribution to national decision making on the future shape of Irish pension provision.”

Speaking at the launch, Anne Maher, Chief Executive of The Pensions Board, said: “The Board’s primary role is a regulatory one which involves registration, auditing, monitoring and investigations in relation to occupational pension schemes and PRSAs. Key areas of regulatory focus in 2004 and early 2005 were monitoring the funding position of Defined Benefit pension schemes and enforcing the mandatory access requirements for PRSAs. At the end 2004 there were 1408 schemes subject to the Funding Standard. These schemes must submit Actuarial Funding Certificates to the Pensions Board at regular intervals and 596 Certificates were submitted in 2004. Of these, 356 (60%) satisfied the Funding Standard. The remaining 240 (40%) needed to submit funding proposals to the Board in order to meet their compliance requirements”.

Discussing PRSAs, Ms Maher said: “PRSAs have been in place since 2003 and the requirement that all employers who do not have an occupational pension scheme must provide mandatory access to a PRSA for excluded employees has been in force since 15th September 2003.This requirement is a key component in the drive to increase private pension coverage in Ireland. The Board has a responsibility to enforce this mandatory access requirement and has been actively engaged in monitoring employer compliance. Activity in this area in 2004 included responding to whistleblows received, random audits of employers and a major exercise in contacting 64,000 employers who have been identified as possibly not complying with the requirement. An additional monitoring system has been added through the Social Welfare Inspectors who include a pensions compliance check with
their other employer monitoring activities. A follow up exercise on a substantial number of employers who still have not confirmed their status is currently in hand and will continue until they have met their obligations”.

Overall, the Board has found an improvement in compliance. However, the Board is not yet satisfied that a good standard of compliance is consistent and universal and will continue its efforts to bring this about.

For further information:

Mary Hutch
Head of Information & Training
The Pensions Board Tel (01) 613 1900

Aongus Horgan
Assistant Head of Information & Training
The Pensions Board Tel (01) 613 1900

Jackie Gallagher
Q4 Public Relations Tel (01) 475 1444/ 087- 2371838

Notes

Key Facts on 2004

The Board continued its pro-active compliance activities including audits of 270 schemes selected for audit and meetings with 19 practitioner entities.
726,405 members in current occupational pension schemes on the Board’s register.
Recommendations were made to the Department of Social and Family Affairs on implementation of the EU IORPs Directive.
The review of the Funding Standard was completed and a report submitted to the Minister in December 2004.
56 new investigations into occupational pension schemes were initiated.
41 “whistleblows” were received in relation to occupational pension schemes.
61 “whistleblows” were received during 2004 in relation to PRSAs.
As of March 2005, the total number of PRSA contracts was 50,796 with the total value of assets of €224.1m
A questionnaire was issued to 64,000 registered employers as part of the process to monitor employer mandatory access provision.
42 information presentations were given to interested parties.
The second edition of the Trustee Handbook and Codes of Practice was published in November 2004.

National Pension Review
The Pensions Board was requested by the Minister to bring forward to 2005 the report on coverage and associated matters required under legislation which was to be completed by September 2006; the report to examine alternative pension systems to the present one and to make proposals designed to provide an adequate retirement income for all. In response to this request, the Board has initiated the National Pensions Review which includes:

a detailed exposition of the scope of the Review has been issued;
proposals have been invited from interested bodies and the wider public;
a number of consultancy studies have been commissioned,

with a view to the Board submitting a comprehensive report to the Minister by late October.

About Mandatory Access – 15th September
All employers were required on 15th September 2003 to enter into a contract with a PRSA provider so that access to at least one Standard PRSA is available for all “excluded employees” on and from that date.

Excluded employees are:

Employees of an employer who does not offer an occupational pension scheme, or
Employees included in an occupational pension scheme for death in service benefits only, or
Employees included in an occupational pension scheme that does not permit the payment of additional voluntary contributions, or
Employees who are ineligible to join the occupational pension scheme and who will not, under the rules, become eligible to join the scheme for pension benefits within 6 months from the date they commenced employment.

About the Pensions Board
The Pensions Board is the statutory body set up to regulate occupational pension schemes and PRSAs and to advise the Minister for Social and Family Affairs, and through him, the Government, on overall pension policy development.