Early Access To Pensions Proposal May Have Some Merit – Ó Ríordáin

Statement from Aodhán Ó Ríordáin TD
Labour Party, Dublin North Central
Wednesday, 8th February 2012

Aodhán Ó Ríordáin, Vice-Chair of the Jobs, Social Protection and Education Committee has stated that an option of allowing people to gain early access to a portion of their pension pots may have some merit.

The Labour Party TD was speaking after chairing a briefing from the Irish Brokers Association (IBA) for the Jobs, Social Protection and Education Committee. The IBA put forward a proposal which would allow people to gain access to the 25% tax free lump sum of their pension before they reach retirement age.

Deputy Ó Ríordáin stated: “I think the proposal put forward by the IBA today has some merit. During this time of severe economic turmoil, I believe there would be many benefits in allowing people to gain access to a small portion of their pension pots in order to pay down debts and give them some breathing space.

“This in turn would do a lot to stimulate our stagnant domestic economy by freeing up some funds for people to spend on things which they may be putting off at the present time.

“I would have some reservations about allowing people gain access to the 25% tax free lump sum, but I believe giving people the option of drawing down a more reduced rate would be an option worth considering.

“It’s quite clear that families and individuals need facilities to alleviate the enormous levels of debt that they find themselves in. I think the Government’s strategy on personal insolvency will do a lot to help people in this regard, but it will do no harm to explore other avenues at the present time also.

“Ultimately, what we must achieve is striking the right balance between giving people the option of accessing a certain portion of their pension pots but also encouraging savings so people have enough to fall back on when they reach retirement age.”