Parliamentary Question addressed to the Minister for Finance

To ask the Minister for Finance further to Parliamentary Question No. 101 of 28 June 2011, if he has received further correspondence from any of the representative bodies of the pensions industry in relation to the pension fund levy; if any of the pension fund administrators or providers have absorbed any of the pension fund levy by reducing fees and charges; the steps he will take to encourage them to absorb the levy if they have not done so already; and if he will make a statement on the matter?

Reply

On 1 June 2011, I wrote to the representative bodies of the pensions industry with whom I had previously met to further outline my view that the cost of the pension fund levy should be absorbed by a reduction in the fees and charges made by their members. These bodies responded to me by the end of that month but the responses were not particularly positive. One response indicated that it would be a matter for individual companies to decide on the question of the absorption of the cost of the levy into their existing fees and charges but that the scope for companies to do so was extremely limited. I am not aware whether any of the companies involved absorbed any of the pension fund levy in this way or what decisions have been made by them in relation to this issue.
As regards further steps in this matter, I should point out that a group has been established to examine charges in the pensions industry. The group is chaired by the Department of Social Protection with representatives of the Central Bank and the Pensions Board. This study will provide an initial benchmark on the level of pension charges for different forms of funded supplementary pension arrangements and will provide information in relation to disclosure of charges. These data have not been available to date so the study will provide valuable information to inform policy. When this information on pension charges becomes available, I will consider how it may be used to advance the issue of the industry absorbing the impact of the pension fund levy.