Fianna Fáil Finance Spokesperson, Michael McGrath TD, has said people who continue to have their private pension savings raided by the government will take a dim view of Minister Michael Noonan’s efforts to deflect attention away from his broken promise to abolish the pension levy.
Deputy McGrath was responding to Minister Noonan’s comments in Limerick last evening where he signalled the failure to abolish the levy was part of some row with the pensions industry.
Deputy McGrath commented: “Minister Noonan’s commitment to abolish the pension levy at the end of 2014 was absolute and unconditional. He never indicated that the promise to abolish the levy was in any way part of an overall deal with the pensions industry. When the levy was introduced in 2011, the Minister made it perfectly clear that the levy would end in 2014. He repeated this countless times since including in his Budget speech last December. At no time did he signal that the abolition of the levy was dependent on anything the industry would do.
“The reality is that, instead of abolishing the levy as promised, the Minister will now increase it by a quarter in 2014 from 0.6% to 0.75% and will retain it in 2015 at 0.15%. The bottom line is that the levy will be collected for the full five years of Minister Noonan’s tenure at the Department of Finance and it will be left to the next Minister for Finance to deal with the issue.
“We know that a high proportion of pension schemes have massive deficits and this levy is only making that situation worse. The levy has resulted in a reduction in pension benefits for thousands of existing pensioners and the future pensions of current savers will similarly be affected.
“If the Minister wants to blame someone else for his broken promise, he should come out and explain the full facts. Otherwise, his comments can only be seen as a cynical attempt to seek cover for breaking a clear commitment made to those who put money away in a pension scheme to provide for their retirement.”