Thursday, January 27, 2022

Kenneth Fox

Over 66 per cent or two-thirds of workers have some form of pension coverage outside a State pension, according to the Central Statistics Office (CSO).

In Quarter 3 2021, pension coverage remained lowest among younger workers – one quarter (25 per cent) of workers aged 20 to 24 years had a pension, up one percentage point from 2020 (24 per cent)

Pension coverage was greatest among workers aged 45 to 54 years where more around 77 per cent of people in employment  had supplementary pension coverage

For employees with occupational pensions from their current employment, the number with ‘defined benefit’ pensions decreased in 2021 (28 per cent compared with 34 per cent in 2020), while the number with ‘defined contribution’ pensions increased to 69 per cent from 64 per cent in 2020.

For those workers with no occupational pension coverage from their current employment, more than half (53 per cent) stated that their employer does not offer a pension scheme

Of employees with no supplementary pension cover, four in 10 (40 per cent) cited affordability as the main reason, while 45 per cent stated that they never got around to organising it or would organise it at a future date

The State Pension was cited as the expected main source of income on retirement for almost 50 per cent of workers with no pension coverage, while more than three in 10 (31 per cent) had not yet decided what their main source of income would be

The Central Statistics Office (CSO) published on Friday the results of the Pensions Survey which was carried out in Quarter 3 (July to September) of 2021.

Supplementary pension

Speaking about the report, Maureen Delamere, statistician said: “Pension coverage in 2021 followed the same trend as in 2020 where pension coverage was lowest among younger workers.

“Just over a quarter (25 per cent) of workers in the 20 to 24 years age group had pension coverage.”

In terms of supplementary pension coverage increases with age, with almost 74 per cent of the oldest age group surveyed, persons aged 55-69 years, having supplementary pension cover.

Most supplementary pension cover is with defined contribution (69 per cent of pensions) rather than defined benefit (28 per cent of pensions).

She said: “Nearly half (47 per cent) of older workers aged 55 to 69 years have been in their current occupational pension scheme for 20 years or more, compared with just over one in 12 (9 per cent) of persons aged between 35 and 44 years.”

In terms of pension coverage by broad occupational groups, workers whose occupation was classified as “Professionals” had the highest pension coverage rate (81 per cent of persons working in this area), whereas, just over four in 10 (43 per cent) of workers whose broad occupational group was “Skilled trades” had pension coverage.

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