The Pensions Council in Ireland has published a request for proposals from interested parties to assess the technical feasibility of an alternative automatic enrolment (AE) proposal.

The government has asked the council to analyse a proposal for a structural basis for the proposed AE system and provide an assessment of its technical feasibility, including the appropriateness of any underpinning assumptions, and whether the modelling and evidence provided is sufficient to provide assurance of feasibility.

Therefore, the council is asking for proposals from interested parties to carry out this assessment, which would analyse the proposed model and understand the sources of outperformance compared to the AE system currently set out in the Draft Heads and General Scheme of the Automatic Enrolment Retirement Savings System Bill 2022.

A copy of the proposed alternative model and form of quote can be found on the Pensions Council's website.

Assessments should include analysis of the proposed alternative model, modelling, assumptions, performance and the ‘various assertions’ made in relation to the proposed model in an Irish context.

The council is interested to understand several factors and implications of the alternative model, including the extent of its reliance on one or more key assumptions and the reasonableness of the proposed assumptions into the long-term future, and the main determinants of outperformance.

Furthermore, it wants an assessment of the differing levels and types of risk in the proposed model, the implications if the assumptions prove to be incorrect, any relevant limitations, and the ability of the proposed model allocate returns in a fair manner over the long term, among other things.

Interested parties have been asked to submit a ‘Request for Quote’ by midday on 7 July 2023.

In is introduction, the alternative AE proposal stated: “This paper meets the brief by proposing a reform to the UK’s current AE system, which delivers more than 50 per cent better value for members, and can be extended to improve outcomes for retirees under DB and non-AE DC arrangements.

“It will transform the world of pensions as profoundly and permanently as passive investing transformed the world of investments, raising investment returns, lowering expenses, and removing an entire swathe of adviser costs.

“By shifting the investment focus from short-term returns to sustainable returns over a 50-year plus investment horizon, it will ensure that investment is premised on societal needs and the green transition.”

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