Broughan criticises pensions legislation

New pensions legislation is unlikely to avert a "future Irish version of Robert Maxwell" it was claimed in the Dáil. Labour's Social and Community Affairs spokesman, Mr Tommy Broughan, said the pensions' Ombudsman allowed for in the legislation, would not have enough powers of inquiry into the management and auditing of pension funds. He was referring to the UK pension scandal affecting the Mirror Group.

However, the Minister for Social, Community and Family Affairs, Mr Ahern, who introduced the Pensions (Amendment) Bill, stressed it would improve security, quality and flexibility for holders of existing and future pension schemes. An Ombudsman would be appointed for those who have a dispute or complaint about a pension scheme, with powers to go back up to six years for complaints.

The legislation also aims to dramatically increase the number of people with pensions from the current level of less than 50 per cent of the working population.

Its provisions include the establishment of Personal Retirement Savings Accounts (PRSA), and Mr Ahern hoped there would be a significant increase in the numbers, currently 630,000, with pension coverage, "especially for those with no cover at present, which would include a large proportion of women".

Mr Broughan criticised the Minister for not making contributions by employers mandatory and said it was a "major cop out". It would inhibit the numbers taking pension coverage, he said.

But the Minister said the Pensions Board had agreed that contributions by employers should be voluntary, but that they would have to provide access to PRSAs. Full mandatory provision could be introduced after a review. If the proposed arrangements did not succeed on a voluntary basis the position "will have to be reviewed sooner rather than later".