As an employer, what do you need to know about the Irish pension landscape in 2023? Asks Susan O’Mara of CPAS.
Pension provision for staff is a valuable recruitment and retention tool for employers. Pensions can be a core part of a benefits and reward package offered. When there are labour or skills shortage affecting your hiring capabilities, this can be a meaningful part of your offering to ensure you are competing with top employers for talent.
The IORP II Directive “sets common standards by ensuring the soundness of occupational pensions and better protecting pension scheme members and their beneficiaries.”
Employers sponsoring an occupational pension scheme for their staff will have had to ensure that there scheme meets the their IORP II regulations. Employers that have not already done so, will need to decide urgently what the best solution for their defined contribution pension scheme is. Employers can continue their own scheme in its current format and support the implementation of the IORP II requirements having regard for the enhanced levels of governance and compliance along with the additional cost for the sponsoring employer.
If you do already have a scheme in place and this has not yet been crossed off your to do list, you can talk to CPAS today to discuss what the impact might be and what steps you can take.
Auto Enrolment – What is it?
The Government is making it mandatory for all employers to contribute to a pension scheme for their staff and are setting up a scheme set to cover anyone between the ages of 23 and 60, earning over €20,000 a year. If they are not already covered for pension, they will automatically be enrolled into the pension scheme.
This Government has set themselves an ambitious target date of early 2024 for implementation of the scheme, which remains to be seen, however, it is likely that media coverage on pensions will certainly be ramped up throughout 2023.
As a pension professional, I see any increase in the public consciousness around saving for retirement as a very good thing. The trend towards an ageing and shrinking population in Ireland means that by 2050, the State Pension as we know it will be under pressure. As the current state contributory pension of just over €13,000 per annum is the bedrock or only source of income for private sector retirees, this is a source of concern.
The state pension age has increased, to age 66, and while it was due to increase to age 68 eventually, political pressure rolled this back and now we may be looking at the option of taking state benefits later for a higher pension. Much is in flux, but what we do know is the push by the Government for both employer and personal responsibility is on.
Overall, as an employer, Pensions should be on your agenda in 2023 and speaking to your provider or indeed to CPAS, can ensure you are ahead of the game on all things pensions.
CPAS are the specialists when it comes to pension provision and financial advice for employers and staff in the Construction sector. CPAS administer the Construction Workers Pension Scheme and the Construction Executive Retirement Savings (CERS).
Contact Susan O’Mara via email: email@example.com or phone directly on 01 2234942.