New pension scheme announced

It's part of a major overhaul of the country's pension system.

The Minister for Social Protection has announced more details of the new Automatic Enrolment Retirement Savings System for Ireland.

The scheme, when up and running, will see workers auto-enrolled in a pension. They will then make their own contributions, with their employer and the State also making payments.

The scheme, which is already up and running in a number of countries across the world, is designed to reduce pressure on the state pension system.

Ireland is the only OECD country that doesn’t yet operate an auto-enrolment or similar system as a means of promoting pension savings. The Department of Social Protection says it is designed to simplify the pensions decision for workers and make it easier for employers to offer a workplace pension.

People will be automatically included in the scheme, with the option to opt-out.

The State will provide a top-up of €1 for every €3 saved by the worker. This means that for every €3 saved by the employee, a further €4 will be invested by the employer and the State combined.

Speaking following the announcement of the new details, Social Protection Minister Heather Humphreys said "if people want to retain a reasonable standard of living in retirement, they need to start saving as soon as possible.

“This major reform in the Irish pensions landscape is intended not just to get people saving earlier but to support them in that saving process by simplifying the pension choices and importantly by providing for significant employer and State contributions as well.

“What we are doing today is putting in place a system whereby people can save for their retirement.”