The Irish government has approved the General Scheme of Auto Enrolment (AE) Retirement Savings System Bill, Minister for Social Protection, Heather Humphreys, has announced.

Humphreys has now referred the bill to the Joint Oireachtas Committee on Social Protection for pre-legislative scrutiny.

The Department of Social Protection said that the announcement marked “historic progress” on the delivery of an AE system in Ireland, which is due to be introduced in early 2024.

Employees in Ireland that meet the eligibility criteria will have access to a workplace pension scheme, which is co-funded by their employer and the state, on an opt-out basis.

All employees not already enrolled in a workplace scheme between the ages of 23 and 60 and earning more than €20,000 across all their employments will be automatically enrolled.

It will be gradually phased in over a decade, starting in 2024, with both the employer and employee initially contributing 1.5 per cent of gross salary, which will automatically increase every three years until it reaches 6 per cent of earnings in year 10.

The employer’s contributions will match those of the employee and the state will also contribute at a rate of €1 for every €3 saved by the employee.

A Central Processing Authority will be established to manage the AE system, while participants will have a range of funds to choose from, included a default fund for those who prefer not to make an active choice.

The government estimated that 750,000 workers will be auto-enrolled initially, with this number expected to grow over time.

“The delivery of AE has been a key priority for me since my appointment as Minister for Social Protection,” Humphreys stated.

“Earlier this year I published the final design principles for the AE Retirement Savings System for Ireland. Since then, a lot of work has been undertaken in progressing its implementation.

“This includes the drafting of the Heads of Bill which I am pleased to say have now been approved by government.

“This represents a historic milestone in the journey towards enabling people who are currently without occupational pension coverage to save for their retirement.

“After decades of talking about AE in this country, I am pleased to say the AE train is now very firmly on the tracks and leaving the station ahead of its introduction in early 2024."

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