Fine Gael TD calls for relief for defined benefit pensions

Fine Gael TD Mary Mitchell O'Connor called for relief for those with a defined benefit pension in next week's budget.

She said she wanted to voice the concerns of an estimated 420,000 people who would learn next Tuesday whether their savings would be taken from them again.

“I refer to those who contributed to a defined benefit pension scheme and who, since 2011, have been subject to a pension levy of 0.6 per cent,’’ she said. “A further 0.15 per cent levy has been applied since last year’s budget.’’

Ms Mitchell O’Connor said the levy was originally to apply for four years to generate funds to create up to 100,000 jobs, among other things.

“The jobs are being created and the economy is improving, all of which is very welcome,’’ she said. “The pension levy has served its purpose.’’

She said older people who were frugal and saved for their pensions were penalised and now deserved a break.

“The Government promised that the levy would be a temporary measure, so now is the time to show these people our appreciation for their help in steering the country from an economic and employment crisis,’’ she said.

Frustrated

Ms Mitchell O’Connor said she had received a letter from a frustrated constituent in

Dún Laoghaire

who said that, as he came close to retirement age, he found €40,000 being “stolen’’ from his private property, a fund that was already diminished by the long-term underperformance of the pensions industry.

Minister of State Paudie Coffey, standing in for Minister for Finance Michael Noonan, said the value of money raised from the stamp duty levy on pension fund assets had been used since 2011 to fund the wide range of measures introduced in the jobs initiative.

He said that he would bring Ms Mitchell O’Connor’s concerns, which he knew were strong, directly to Mr Noonan. “I assure the deputy her concerns will be brought to the attention of the Minister,’’ he said.