It’s time to find an all-party agreement before the General Election on funding future pensions – Hayes
Brian Hayes MEP, speaking last night at the Annual Irish Association of Pension Funds dinner in Dublin, urged the government to address the growing pension liability in Ireland.
“The Irish economy is now in recovery mode and entering a high growth path. Now is the time for some serious long term thinking and planning,” said Mr. Hayes.
“The electoral cycle should not divert us from the need to provide for the future. We need an urgent national debate about pensions and how they will be funded. CSO projections indicate that over the next 30 years the number of people over the age of 65 will rise from a current level of 600,000 to around 1.5 million; an increase of 150%. The vast majority of these people will be dependent on the state for their pensions.
“We should not remain in denial regarding the scale of the pension challenge which lies ahead. The scale of foreseeable future pension demands is the elephant in the room nobody wishes to see. Ireland is not alone in this. Many other countries in Europe, particularly Germany and Italy, have rapidly ageing populations.”
“The former Minister for Finance Charlie Mc Creevy deserves great credit for establishing the National Pension Reserve Fund in 2000. Unfortunately as the crisis deepened it became necessary to raid the fund to shore up government finances. A debate is now opening up regarding tax cuts, increase in public sector wages and increased spending on public services. Providing for future pensions has to be part of that debate.
“The government should address the pensions issue in its Spring Economic Statement. I suggest an attempt should be made this year to reach an all-party agreement before the general election on setting aside each year a certain percentage of government revenues to fund future pension requirements. Ireland’s current favourable demographic profile will not continue into the future. We need to realise this and plan accordingly. Setting aside resources now will help meet rapidly rising pension payments in the future.”