New figures from the Central Statistics Office (CSO) reveal that just half of workers are actively saving towards their retirement through an occupational or private pension. And six-in-ten of those with no occupational pension expect to depend on the State pension as their only source of retirement income.
This huge gap between workers with occupational pensions and those without will impact hardest on women and low and middle earners.
The Irish Congress of Trade Unions (ICTU) said the new figures provide further evidence that planned pension ‘auto-enrolment’ needed to be introduced quickly. The auto-enrolment scheme would compel all workers to contribute to an occupational pension scheme, with employers and the State also paying in.
Although the Government’s plan for auto-enrolment was launched nearly two years ago, important aspects of the legislation still remain unclear – including the level of State contribution to workers’ pension savings.
These and other details were supposed to be ironed out before the end of last year after the formal cabinet approval of the plan. But it didn’t happen.
Fórsa national secretary Billy Hannigan has led the union’s campaign for the introduction of a robust auto-enrolment system. “A substantial number of people in the private sector, especially women, have no occupational pension and are staring at poverty in old age.
“In 2018, Fórsa’s first conference welcomed Government proposals for a new three-way pension scheme involving employees, employers, and the State. Now we need to have details of the new scheme confirmed as soon as possible. The earlier the scheme gets off the ground the better for all of those people who currently have no occupational pension coverage,” he said.
The CSO survey found that 53% of those without occupational pensions cited the lack of employer provision as the reason.
In cases where employers offered an occupational pension but workers opted not to participate, the most common reason for non-participation was that they “never got around to organising it,” while a third of respondents said they couldn’t afford it.
CSO figures on pension coverage in 2019 can be found here.