NoRegretsCoyote
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The big difference is in how the contributions would be collected and managed.
I have to say that there is very little upside to having a range of providers chasing new entrants at high cost.
Also, economies of scale in having collection done by Revenue at source.
I have to say that there is very little upside to having a range of providers chasing new entrants at high cost.
Also, economies of scale in having collection done by Revenue at source.
Government’s Proposal | Congress’s Response |
Operational model - Workers will have access to a range of retirement saving products from approved pension providers via a newly established Central Processing Authority (CPA). - Workers’ contributions will be deducted by employers directly from wages and transferred to the CPA. The CPA remit contributions to the pension provider. | Collect contributions in the same way as social insurance: the employer deducts the worker’s contributions at source, the employer and worker contributions are then collected by Revenue and all contributions noted on pay slip. - Revenue to remit the contributions to a State fund. |
Service providers - CPA will tender every 5-10 years for 4 commercial providers for provision of pension saving products. - Workers will be responsible for selecting one of the 4 providers and a saving option. - A maximum management fee of 0.5% p.a | One provider, a public fund e.g. the NTMA. - The NTMA to contract out management and investment of proportions of the fund. - The 0.5% maximum management fee is excessive. |