IRELAND - Ireland's minister for finance failed to contact the Pensions Board before the unveiling of a controversial pensions levy that could cost as much as €470m a year.

Speaking in the Dáil, Fianna Fáil leader Micheál Martin asked whether the government fully understood what impact the levy would have on the pensions industry.

He then claimed minister for finance Michael Noonan had admitted in a written response to parliamentary questions that he had "no communication whatsoever" with the country's Pensions Board before deciding to introduce a 0.6%, four-year pensions levy as part of employment measures in the Finance (No. 2) Bill.

Martin said: "The Pensions Act states, as the first function of the board, that it will both monitor and supervise pensions developments, and it explicitly envisages that the minister for finance should seek advice from the board."

He also asked if the Taoiseach - or prime minister - was "happy" that the legal role of the board had been ignored.

But Taoiseach Enda Kenny rejected accusations that the legal role of the Pensions Board had been circumvented and said it had been clear "long before" the recent general election that the government would pursue a levy collected by the industry itself.

He went on to say that sectors within the pensions industry had endorsed what critics have called a "raid on pensions".

Kenny acknowledged that other avenues were being examined, such as a recently suggested tax on asset management fees, with Noonan in "direct discussions" with the pensions industry about implementing such proposals.

The Irish Association of Pension Funds, which strongly opposed the levy, had previously told IPE it had been unable to talk to the ministry directly regarding its concerns prior to legislation being unveiled.

The Taoiseach, addressing Irish Funds Industry Association's Annual Global Funds Conference, praised the funds industry for seeing a 5% growth in jobs over the past year.

He argued that Ireland was facing economic challenges head on, adding: "I want to assure everyone here today that Ireland will emerge from this crisis stronger than ever."

Kenny added that the country's banking problems were being tackled by recent reforms and stressed the importance of international investors.

"We recognise the importance of the international finance sector," he said. "We will ensure the environment for the development of international financial services and, in particular, investment funds, continues to offer significant opportunity."
 

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