The newly-elected President of the Irish Insurance Federation (IIF), Mr Gerry Hassett (Irish Life), today called on the Government to provide clarity around pensions policy and address the looming pensions crisis which will be the next big fiscal challenge the country faces. Also speaking at the event was Guest of Honour Minister for Social Protection Ms Joan Burton, T.D.
Speaking at the IIF’s Annual Lunch Mr Hassett said: “The pensions ‘time-bomb’ is ticking – and it is my strong belief that this will be the next big fiscal challenge to the Irish Exchequer once we resolve the current crisis. The Irish Government has made incentives for retirement planning a key policy priority for several years now. However, it is disappointing to note that every single policy measure in recent years has served to discourage workers from saving for their retirement. The net effect of this has been to discourage workers from providing for their own retirement – not just in terms of joining but also in keeping up contributions to existing plans. We need to restore the confidence that’s been draining away. Encouraging ordinary workers to save for their retirement is a noble cause, and it’s one which we passionately believe in.”
Mr. Hassett pointed out that, contrary to the popular image of ‘fat cats’ taking advantage of pensions incentives to build tax shelters, 90% of contributors to private pensions earn less than €70,000. He urged the Government to publicly re-commit to support for these middle income workers in their retirement planning.
Mr. Hassett also spoke of the contribution insurers have made to the Irish economy and pointed out that the need for regulators and legislators to differentiate in the supervision of insurers and banks.
“Ireland Inc could not survive as an open economy without a strong insurance sector,” Mr. Hassett said. “The most important thing insurers do is pay claims to customers at times when they need it most. Each year we pay out more than €10bn in benefits and claims to Irish customers. This was seen to great effect during the floods and freezes of the last 18 months when our members paid out over €750m in claims. Insurers helped the Irish economy recover from some of the most severe weather events to ever hit the country. We are the safety net of the Irish economy. We are not Banks. We were not reckless during the boom. Our governance structures did not fail. Our solvency margins did not falter. We do not rely on the Government for support.”
IIF member companies hold assets in excess of €80bn – much of it in Ireland. International insurance business generates €20bn in exports every year and account for 65% of the jobs in the IFSC. Overall, more than 14,000 people are employed by insurance companies in Ireland, with thousands more in ancillary services.