Sir, – Recent figures from the Central Statistics Office show that occupational pension coverage has dropped from 51 per cent in 2009 to 46 per cent today. But this disappointing figure masks an even bigger crisis in Irish occupational pensions. To date, 750 defined benefit schemes have closed, resulting in massive losses for the many thousands of workers concerned. The schemes that survived are closed to new members and have no provision for increases to pensions in payment. This means that with moderate levels of inflation a pension will lose 50 per cent of its value in 20 years. In the event of a return to high levels of inflation, a pension will become worthless in a very short timeframe.
At least with defined benefit schemes those in the know (if not the workers) are aware of how things are. On the other hand, members of defined contribution schemes will have to wait until they retire to know how well or how badly the pension industry has handled their contributions. Meanwhile, members of both types of scheme pay many millions to a regulatory regime that has totally and utterly failed them.
If the coming generation is to avoid an old age of poverty, the creation of a universal pension scheme involving contributions by all workers and employers is essential. However, if workers are to have any faith in such a scheme, the first step has to be the establishment of a regulatory system that has as its core object the protection of the interests of scheme members. – Yours, etc,
FERGUS WHELAN,
Irish Congress
of Trade Unions,
32 Parnell Square,
Dublin 1.