Fianna Fáil Spokesman on Public Expenditure and Financial Sector Reform Michael McGrath TD has said that thousands of existing pensioners will have their pensions reduced as a result of the Government’s decision to impose a €1.9 billion levy (or 2.4% of the value) on funded pension schemes and personal pension plans.
“The Government’s statement that how the pension levy will affect individual pensions will be a matter for individual pension scheme trustees and administrators is a total cop out. The Government is trying to create the impression that it is not cutting people’s pensions. This is not true.”
“In its Q&A booklet, the Department of Finance has made it clear that legislation will be passed to allow pension scheme trustees / administrators the option to adjust the benefits payable under pension schemes or plans. In other words, the Government will pass legislation to allow pensions to be cut by the schemes themselves. Nobody will be fooled by this.”
“The Government has also acknowledged that public sector workers in unfunded schemes and all public sector workers who make additional voluntary contributions (AVCs) will also be hit by the levy.”
“Many pension schemes are already experiencing a funding crisis. This levy will only make matters worse.”
“The truth is that older people will be hardest hit by this levy as they have paid the most into their funds. This €1.9 billion pensions smash and grab raid will lead people to believe that any form of saving or investment they have made is no longer beyond the reach of the Government,” stated Deputy McGrath.