Pension auto-enrolment to be delayed by 'number of months', says Minister

THE INTRODUCTION OF the auto-enrolment pension scheme is to be delayed again, with the minister saying it could be a number of months beyond the September commencement date.

The hold up has been put down to the amount of administration that is required, and the government’s desire to launch it in alignment with other projects.

Finance Minister Jack Chambers confirmed the delay on RTÉ Radio One’s show This Week.

He said the commencement date will be adjusted “only marginally”, but that it would likely be “a small number of months” after 30 September.

He said the timeline for the change is “under active consideration” and that Social Protection Minister Dara Calleary is to update the government on it “in the coming weeks”.

On the reason behind the delay, Minister Chambers said: “This is an enormous scale of administrative work which is required to bring a huge amount of people within that framework quickly, and and I suppose it’s just to sequence the timing aligned with other government decisions.”

He added: “Auto-enrolment is going to be absolutely essential to build sustainability for pensions in the long term and and the exact nature of the commencement is what Minister Calleary is currently considering.”

Asked about it at the commencement announcement in October last year, then-Minister Heather Humphreys said: “We’re giving businesses a year lead in time, because there have been concerns about further expenses on businesses.”

A delay to replacement of minimum wage with a living wage was also signalled.

Chambers said the “nature and scale” of wage increases may now be “extended over a slightly longer period” – which was subsequently slammed by Labour’s spokesperson on workers’ rights Senator Nessa Cosgrove as an “idealogical choice” rather than an “economic necessity”.

How will auto-enrolment work? 

The scheme will apply to almost 800,000 workers between the age of 23 and 60 who are employed but not enrolled in an occupational pension scheme, and drawdown will be aligned with the State Pension.

It’s targeted to this cohort to allow them to begin saving for their pension earlier and to ensure that people are not left on just the State pension when they retire.

The scheme will see employees contribute into the pension pot, with their contributions matched by their employer, as well as a further top-up from the State.

So, if an employee were to pay in €3 to their pension pot, their employer must match their contribution and put in €3, while the State provides a €1 top-up.

For every €3 an employee puts in, they will end up with €7 in their pension pot.

All employees who are not already in an occupational pension scheme, and are aged between 23 and 60 and earning over €20,000 across all of their employments, will be automatically enrolled under the new legislation.

It will be possible for workers to opt out of the scheme if they wish or to suspend their contributions, after six-months mandatory participation.

Source: Mairead Maguire, The Journal, 13th April 2025.