Latest News

Below you will find all the latest news and updates from IAPF.  

Almost half of Irish schemes exploring opening existing schemes to unpensioned staff

07/05/2024 Posted by IAPF | Comments(0)

Almost half of Irish occupational pension schemes are exploring the option of opening their current scheme to unpensioned staff, in response to the introduction of the auto-enrolment pension system in Ireland.

A poll of delegates during a presentation at the Irish Association of Pension Funds (IAPF) Summer Conference, last week, by Irish Life director of corporate partnerships, Shane O’Farrell, revealed 47 per cent of delegates were considering the option of opening their schemes on an opt-in basis.

Twenty per cent are exploring opening the existing scheme to all with an employer-only contribution and encouraging individual contributions. A further 20 per cent are considering a mixture of these two scenarios, varying by the different profile of staff.

Just 9 per cent are planning to do nothing and allow auto-enrolment to pick up non-pensioned staff and 4 per cent are planning to open existing plans at new auto-enrolment type rates to all on an opt-in basis.

O’Farrell said 98 per cent of schemes have some form of pension gap, and with the definition of employer being so broad in the legislation, most employers will be impacted by the auto-enrolment system.

“If an organisation thinks it doesn’t have anyone in scope for auto-enrolment it hasn’t looked hard enough because the definition is so wide. Most organisations have some form of pension gap… almost every plan will be impacted by auto-enrolment to some extent” he said.

He said Irish Life recommends a five-point list as there is a lot of work to do: Assess the gap, decide the best route, plan for existing staff, future proof for new staff – and then do it.

“It needs careful engagement and planning with other parties, such as trustees, the finance team, and so on,” he said.

He said trustees will also be impacted by auto-enrolment as there could be some changes to scheme rules: “If employers want to enhance their pension arrangements, there might be removal of waiting periods etc, which will come through to the trustees to note and approve.

“There could be new categories with new contribution rates… you may have a whole new cohort of people joining the plan, who were not previously in the plan and who are a different type of profile by salary or by work and you may need to make sure your communications strategies and your member engagement policies are adapted for that type of cohort.”

Read the original article here

Add a Comment

Notify of New Replies:
Add a new comment:

Cookie Preferences