Good evening everyone and welcome again to the IAPF Annual Dinner for 2019

It is a pleasure to see so many of you here for our 44th annual dinner, and my last as Chairperson. I would like to particularly welcome the representatives from the Department of Employment Affairs and Social Protection, the Pensions Authority and the Pensions Council who have joined us this evening. We do very much appreciate your attendance. I would also like to welcome our other distinguished guests and of course our after dinner guest, Paul O’Donovan, who personally I am tremendously looking forward to hearing from.

On this very date last year and in extremely different weather conditions, by about a margin of 20°C, the Government published its pensions roadmap. The roadmap is a hugely ambitious document and we welcome the thought and effort which has gone into it.

Over the past 12 months, there have been four major consultations on different aspects of the roadmap - on auto enrolment, reform of the state pension, tax simplification and reform and regulation of master trusts.

We welcome these consultation exercises, and we have participated very actively in them. I want to thank both our Council and our committee members for the work they put into our responses, which I think have moved the dial on certain aspects of the Government’s proposals.

Apart from these formal consultations, we have had enumerable more informal engagements with the Government and the Regulator on individual aspects of the Roadmap, led by our tireless Chief Executive Jerry Moriarty. In our view, consult, consult, consult on policy change - getting the views of key stakeholders is never a bad thing, and it is not a one way street. 

For instance, when I spoke last year, I said that our strong view was that the State should not take a role in the operation of an auto enrolment system.

The straw man published by the Government last summer caused us to reconsider our views on that one, because a strong case was made by the Government for centralising many AE functions in a central processing agency, which would minimise the burden on smaller employers and maximise economies of scale in a small country. This was innovative thinking by the Government, and we responded constructively to it. 

By contrast, the lack of consultation by the Government on the implementation of the IORP II Directive is not helpful, and not conducive to best implementation.

However, that is one black spot in a wider road map. 

I have participated in many meetings and engagements with Government officials over the past 12 months, and I can see the commitment and sincerity which has gone into the reform process. I want to pay tribute to Robert Nicholson in particular, who by reason of promotion has recently left the pension area, but who has given tremendous thought leadership in the area of auto enrolment in particular. 

If that’s the upside, the downside is that we are already lagging behind on the roadmap’s timetable for implementation actions. 

Of the 24 actions which were due to be implemented under the roadmap by the end of 2018, only 5 have been implemented. Of the 11 additional actions due to be implemented by the end of March, only one has been implemented as yet.

Brexit is of course an all-consuming issue for the Government at the moment, but as 2019 proceeds, normal Government service has to resume and long term pension policy is a critical part of that. 

So we want to see progress on key actions which are now due or overdue under the roadmap, including the publishing of the final design for the auto enrolment system, the reform of approved retirement funds, pension tax harmonisation, and the elimination of current anomalies in the treatment of different retirement vehicles and of course the additional protections for funding of defined benefit schemes, promised by Leo Varadkar at this dinner two years ago.

Now, while we welcome much of this policy agenda, we are also faced with an increasing appetite for regulation of the pension sector, and not all of this is good or worthwhile. 

The Government cannot control the desire by the European Central Bank and the European Insurance and Occupational Pension Authority (EIOPA) to introduce financial and statistical reporting by Irish Pension Schemes, which will be coming in later this year. 

What Government Agencies can do, and what we will fight for them to do, is to introduce these requirements in the most cost efficient and least invasive fashion possible. 

I talked last year about the work that PensionsEurope had done to mitigate the impact of these measures. However, they still have the potential to be hugely draining on the resources of Irish Pension Schemes if implemented poorly.

The same is true of the implementation of the IORP II Directive, and the related governance and fitness and probity changes that are proposed as part of the pensions roadmap. These changes must be introduced, but they should be introduced in a proportionate manner and with sufficient timelines for smaller pension schemes which may not be in a position to comply with the new requirements to migrate to alternative structures, such as a fully regulated master trust regime or indeed auto enrolment.

This is in the wider interest of maintaining pensions coverage, which all stakeholders accept is critical. 

We will continue to advocate for regulation to be proportionate to the size, nature, scale and complexity of a scheme, as provided for under the Directive and we do welcome the indications received to date that the Government and Pensions Authority recognises this as an issue. This is not about changing the direction of regulation, it is about ensuring that it is implemented in the most cost effective and least invasive manner possible for our members. 

We convened a meeting of all of our voluntary committee members last month and there was a strong consensus that the burden of regulation is the most important issue facing the pension sector in the next couple of years. Addressing it will involve an intensive effort on the part of the IAPF, and we will not be found wanting in representing our members on this issue.

So we look forward to engaging with the Government and with the Pensions Authority on both high level policy and day to day regulatory issues for the benefit of our members.

On a personal level, I would like to again pay tribute to the voluntary efforts made by our various committees on behalf of the association. Our Benefits Committee led by Peter Griffin, our DC Committee led by Colm Fortune, our Investment Committee led by John Griffith, our Regulatory and Administration Group led by Tom Gilligan, our Regional and Southern Group led by John O’Callaghan and our Large Funds Forum led by Tony Murray.

I want to thank my fellow Council members, who bring a huge diversity of expertise and experience to shaping the policy and direction of the Association. I want to particularly thank my Vice-Chair, Eunice Dreelan for all her support to me over the past 12 months and I look forward to supporting her when she takes over as Chairperson in May.

I want to pay tribute, as I have done before to Jerry Moriarty our Chief Executive who works tirelessly and very effectively on behalf of our members. Among other things, Jerry has continued his focus on what is happening in Europe, and he joined one of EIOPA’s key stakeholder groups last year. 

Even if Brexit is now to be deferred, UK representative bodies have lost their focus on European pension developments over the past 12 months, and the IAPF needs to fill that gap at European level in representing the interests of a trust based, common law occupational pension system. 

Jerry’s colleagues on the executive team, Deirdre Ross, Kelley McMenamin and Amy Peat continue to do superb work in running the Association and organising our conferences and other events.

Last year we provided 2,500 hours in aggregate of education and training to our trustee members, and this highlights both our trustee members’ commitment to education, and our commitment to fulfilling this part of our mandate. 

I would like to thank my firm Eversheds Sutherland for their support to me. I would also like to thank my wife Linda who has been a huge support to me over the past 12 months. 

Thank you for listening and I hope you enjoy the rest of the evening.

Peter Fahy

Chairperson