Age Action has urged the Government to revise its proposals to deal with insolvent private pension funds, in order to protect pensioners within those schemes who are on the lowest incomes.

Under the proposed reforms, existing pensioners in defined-benefit schemes which are wound up would have their benefits frozen until existing workers receive their share of benefits. “Age Action believes that existing pensioners in these schemes need to be treated equitably so that those on low pensions do not take the same pain as those on large pensions,” Age Action spokesman Eamon Timmins said. “For example, late entrants or those on lower paid jobs will receive lower pensions, but will depend on these to a greater degree. To treat both the same would mean the low income pensioner would experience a disproportionate amount of pain.”

The older people’s charity recognised that existing pensioners in insolvent schemes would be hit in order to ensure that those about to retire had an income. However, it believes that this should be done fairly.

Age Action welcomes the Government decision to establish a pension insolvency payment scheme to enable trustees of pension scheme in deficit to buy the equivalent of an annuity through the National Treasury Management Agency at cost price. “This is a commonsense measure which will ease the pressure on some pension schemes, and provide peace of mind for those approaching retirement,” Mr Timmins said.

Finally, Age Action is urging the Government to publish a comprehensive package of measures for the pensions sector, following the widespread consultation for its Green Paper on pensions. “We need leadership on this issue,” Mr Timmins said. “By setting out its plans for the future, the Government would provide clarity and enable people plan for their future with greater confidence.”

FOR MEDIA QUERIES CONTACT EAMON TIMMINS, HEAD OF ADVOCACY AND COMMUNICATIONS, AGE ACTION. 01-4756989 OR 087-9682449