The OECD has completed a comprehensive review of Ireland’s pension and superannuation system. The report concluded that Ireland must make its pension system simpler and fairer in order to ensure the provision of adequate income in retirement.

At approximately 35% of the average wage, Ireland’s current state pension is the second most generous pension plan amongst OECD nations. However, overall retirement incomes in Ireland are relatively low due to the absence of mandatory private contributions to superannuation. New Zealand is the only other OECD country not to have implemented a compulsory private retirement savings scheme.

The OECD report recommends that Ireland introduces an earnings-related pillar, whereby private contributions are either mandatory for all workers or initially compulsory with an “opt-out” provision. Other recommendations include linking the retirement age to life expectancy and allowing retirees to complement their pension payment with employment income.