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Early 2025 target for new pensions system

05 Apr 2024 / legislation Print

Early 2025 target for new pensions system

The Government has announced the publication of the bill that will set up a new auto-enrolment system for pensions.

The Department of Social Protection says that the legislation will bring around 800,000 workers into a pension scheme for the first time.

Minister for Social Protection Heather Humphreys described the Automatic Enrolment Retirement Savings System Bill 2024 as “one of the biggest reforms of the pension system in the history of the State”.

She said that she would bring the bill before the Oireachtas “immediately after the Easter recess”.


When the bill is enacted, employees aged between 23 and 60, who earn over €20,000 a year, and who are not already paying into a pension scheme, will be automatically enrolled in one.

Contributions made by the employee will be matched by the employer and topped up by the State. For every €3 put in by an employee, the employer will also contribute €3, and the State will contribute €1.

Under the new system, contribution rates will be phased in gradually over ten years.

Contribution rates

Starting in 2025, employees will contribute 1.5% of their gross earnings, to be matched by their employer, and topped up by the State.

These rates will gradually increase every three years, reaching a maximum contribution rate of 6% per employee, 6% per employer, plus 2% from the State, from 2034 onwards.

The department says that the phasing-in process will give employers time to budget and plan, and for employees to adjust to the new system.

Participants will be allowed to opt out or suspend their contributions after a mandatory six-month participation period.

New body

The legislation also provides for the establishment of a new State body, the National Automatic Enrolment Retirement Savings Authority, to administer the scheme.

The department describes this body as a “buffer” between participants and the financial firms who will manage their savings.

“The authority will act in the best interests of participants, collect contributions, arrange for the investment of contributions, manage participant accounts that will be accessible through an online portal, and facilitate the payment of savings at retirement,” it says.

Employees will have a range of three savings options to choose from, at a higher, medium, and low-risk investment strategy.

Minister Humphreys says that the first workers will be enrolled in January 2025.

Pensions experts had previously expressed scepticism about the timetable for the introduction of the new system, which had been initially targeted for early this year.

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