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Irish Central bank makes plans to ensure post-Brexit pension payments

14/08/2018 Posted by IAPF | Comments(0)

The Irish Central Bank is working on a contingency plan to ensure that pension payments can continue to flow between the UK and Ireland after a possible hard Brexit.

Irish pensioners who have worked in the UK previously will no longer be able to receive payments directly into their accounts if a deal on ‘financial passporting’ is not reached when the UK leaves the European Union, according to the Independent.ie

Furthermore, Pension Insurance Corporation has advised its Irish members to open bank accounts in the UK. In correspondence seen by the Irish newspaper, it wrote: "As it stands insurance providers may not be able to continue paying out to overseas bank accounts after Britain leaves the EU in March 2019.”

However, the Central Bank said it is working on ensuring it has "robust contingency plans in place to ensure that services can continue post-Brexit".

A spokesperson for Tánaiste Simon Coveney, who is leading Ireland's Brexit preparations, told Independent.ie that the government was working on "all possible scenarios, including the unlikely case of a 'no-deal' Brexit".

"Contingency planning is well advanced, with all issues identified," he said.
The affected include around 120,000 people receiving a UK state pension, as well as an unknown number receiving private pensions, a lot of who have worked in Northern Ireland but live in Ireland.

The head of the Irish Association of Pension Funds, Jerry Moriarty, told the paper: “Under European Union rules, you have a right to have your pension paid into any member state, but no one has a clue how this will work out when Britain leaves the EU.”

The Association of British Insurers has previously warned that the risk of UK leaving the single market means pensioners could be left in a “legal limbo”, if the firm paying out is not authorised to transact business in that country under a new financial framework. (PA)

“This could mean that cross-border pension payments from the UK into the EU or the EU into the UK cannot be paid. It would also affect the ability to pay claims on many liability insurance contracts offered to businesses on a pan-EU basis,” the association wrote in a statement. 

In addition to a contingency plan, the Department of Employment Affairs and Social Protection is also working on the impact of Brexit on the current reciprocal arrangements for social insurance, social assistance schemes and child benefit between Ireland and the UK.

Coveney’s spokesperson told Independent.ie: "The objective is to ensure that the reciprocal social welfare rights and related entitlements, which currently exist for Irish and UK citizens moving within Ireland and between Ireland and Britain under the Common Travel Area, are maintained."

 

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