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Dublin: 2 °C Saturday 16 November, 2019

Noonan defends pension levy in face of 'hysterical' criticism

The Finance Minister has said the government’s introduction of a levy on private pension funds will help to restart the economy – and accused the pensions industry of acting in a “quasi-hysterical” manner.

Finance Minister Michael Noonan.
Finance Minister Michael Noonan.
Image: Niall Carson/PA Wire/Press Association Images

THE FINANCE MINISTER Michael Noonan has defended the government’s plans to introduce a levy on private pension funds to finance the jobs creations budget, accusing the pensions industry of acting in a “quasi-hysterical” manner.

The Irish Association of Pension Funds has described the government’s plans to raise almost €2 billion in the next four years by imposing a 0.6 per cent levy on private pensions as “grossly inequitable“. Similarly, the Pensions Ombudsman has said that he expects to receive many complaints over the plans, RTÉ reports.

The Irish Congress of Trade Unions has also criticised the levy – saying that is “short-sighted, arbitrary and unfair”, reports the Irish Times.

However, Noonan insisted that the effect the levy on pension funds had been “exaggerated” and that the levy was part of the government’s Jobs Initiative for “restarting our economy”, reports Business&Leadership. He said that a “very small proportion” of the tax relief enjoyed by the industry over the years was being pulled back, the Irish Times reports.

The Taoiseach Enda Kenny also defended the levy, saying that it would help to create 100,000 jobs over the next four years.

While much criticism has been aimed at the announcement of the levy, some groups have offered a cautious welcome, RTÉ reports – including groups representing the unemployed and tourism and restaurant sectors.

Read more: Jobs intiative will see levy on private pensions – but travel tax abolished >

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