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POLL: Should it be compulsory for private sector workers to have a pension?

Should it be compulsory for private sector workers to have a pension? The Government has commi...
Newstalk
Newstalk

10.07 18 Apr 2013


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POLL: Should it be compulsory...

POLL: Should it be compulsory for private sector workers to have a pension?

Newstalk
Newstalk

10.07 18 Apr 2013


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The Government has commissioned the Organisation for Economic Co-operation and Development (OECD) to carry out a report into how the State can tackle the country's pension crisis.

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At present, six out of every 10 private-sector staff have no work-based pension -- and rely on the state- contributory pension when they retire.

According to the Irish Independent, this OECD report has recommended to the Government that most of the one million workers with no pensions should be signed up for a private scheme and given no option to leave it.

The OECD says the most "effective and least costly" way to deal with the mounting pensions crisis is to force cash-strapped workers to put aside some of their wages to fund their retirement.

It recommends that middle-income people over the age of 22, without a private pension, should be automatically enrolled and given no opportunity to opt out.

How much could you potentially be made pay?

Under this new scheme, the OECD says workers, employers and the State should contribute 15 per cent of their salary.

Although the Government has yet to comment on this report - it's speculated that such a scheme will be given the green light.

The Social Protection Minister, Joan Burton is known to be in favour of some form of private pensions arrangements for the more than half of the workforce who will only have the state pension when they retire.

She has spoken of a system where those who have no private pension are automatically enrolled in one, but can then choose to opt out.

Up to now, the expectation was that contribution levels would be around 8 per cent, with workers, the State and employers all making contributions.

The Irish Independent reports that the OECD official Paulo Antolin consulted widely with people with an interest in pensions in drawing up the report, which will be launched on Monday, April 22nd.


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