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Review of the Irish pension system

The OECD Review of the Irish Pension System recommends that the Government put in place either a universal basic pension scheme or a single means-tested pension, both topped up with a compulsory private pension.

This review was commissioned to the OECD by Ms. Joan Burton, the Minister for Social Protection, in March 2012. The terms of reference for the review called for a comprehensive analysis, covering all parts of Ireland’s retirement-income provision (the state scheme and other public benefits, personal and occupational plans and schemes for public-sector workers). The review aims to take account of the considerable body of work undertaken in Ireland on the analysis of the pension system and the different proposals for reform put forward in recent years. Furthermore, the OECD received comments (both in meetings and in written form) from a number of interested organisations in Ireland during the consultation process in the period April 2012 to January 2013.

The OECD has been mandated by its member governments to undertake regular monitoring of pension policies and analyse in detail the options and arguments for the direction of retirement-income reform. This reflects a consensus that there are valuable lessons – both positive and negative – to be learned from other countries’ experiences. This review compares the set-up and performance of retirement income arrangements in Ireland to those in OECD countries with comparable systems, and draws on international experiences and examples in making recommendations for reform.
The review makes recommendations for changes in the key parameters of the Irish state, occupational and private pension schemes and outlines options for more profound structural reforms of the retirement income system. In considering these alternatives, it should be kept in mind that each of the national schemes and reforms discussed in this review was adopted in a specific national economic, social and political setting. There is no blueprint for reform which Ireland could take off-the-shelf and implement directly. Any solution has to fit the Irish situation. In addition, any structural reform would have to be carefully costed for both the short and the longer term. Detailed cost projections of reform proposals were outside the scope of this review and would require extensive analysis of administrative data which would have to be undertaken jointly with the Irish authorities.