The Minister for Social Protection has today published the general scheme of the Automatic Enrolment Retirement Savings System Bill. The Bill is expected to be introduced in the Oireachtas following the Easter Recess.

Once the legislation is enacted and commenced, it is expected that all employees aged between 23-60, who earn in excess of €20,000 per year and who are not already enrolled in an occupational pension scheme, will be automatically enrolled into the new system.

Contribution rates are to be phased in over a 10 year period. The system will operate in a manner similar to the old SSIA, in that contributions made by an employee will be matched by their employer and then topped up by the State. Employees will initially contribute at a rate of 1.5% of their gross earnings, rising in increments to a 6% contribution from 2034 onwards. For every €3 contributed by an employee, it will be matched by a €3 employer contribution and topped up by a State contribution of €1. Matching employer and State contributions will be made up to a maximum of €80,000 of earnings per annum.

The goal of the system is to increase pension coverage and pension adequacy in Ireland. It will operate on an opt out basis which will allow employees to opt out after a mandatory 6-month participation period. An employee will be again enrolled after two years if they are not a member of an occupational pension scheme at that point in time.

The Bill also provides for the establishment of the National Automatic Enrolment Retirement Savings Authority, the body which will administer the system.

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