24th July 2012 – Pensions Ombudsman Speech at Launch of 2011 Annual Report
Tá fáilte romhat annseo inniu, chun Tuarascáil Bhliantúil no hoifige seo a láinseail are mo sho, maraon leis an dá cháipéis nua atá le foilsiú freisin. Táimid buíoch díot as an am seo a chaitheamh inár gcuideachta, nuair atá deis agat bheith ar laethanta saoire!
I am very pleased to welcome you here today, Minister, for the launch of the annual report of this office for the year 2011, together with the other documents that we’re also publishing today -- our new plain English booklet for complainants and our new brochure summarising the work of the office. We're very pleased that you have given us your time, particularly when many of your colleagues from the Oireachtas are probably lying on beaches from Cork to Donegal.......
2011 was a busy year for us. While the number of new files opened was a little bit down on 2010, the complaint cases seem to have increased in complexity. Occupational pension schemes are under severe pressure at the present time. Defined benefit schemes in the private sector appear to be in significant difficulties -- more and more complaints that are now arriving seem to centre on matters arising from insolvency of those schemes, or issues that have their origins in decisions to wind them up.
Defined contribution schemes haven't had it easy either. A number of complaints arise because of losses sustained by scheme members in terms of their investment values. Some of those losses are down to market conditions and the difficulties facing our banking system and our economy. Considerable losses have been sustained by members of one-person schemes, set up either as Small Self-administered Schemes or as what are known as "self-directed" pension schemes, as a result of what now turns out to be very unwise investment in property, both here and abroad. It is true that many people affected in this way went into those investments with their eyes open, but I have to say that elements of the pensions industry have not covered themselves in glory when it came to setting up the schemes.
Ordinary, middle income pension scheme members have also suffered, often because investment funds into which they directed their money were described at the time as low or medium risk. Some of these funds are now being described with hindsight as medium or high risk.
The public service, which is also within the remit of this office, has been the subject of severe attrition in the light of the pressure facing our public finances. There have been many early retirements and in some areas there has been a loss of qualified and experienced personnel in superannuation units, which has increased the pressure on the survivors. The task of preparing many illustrations for those who want to consider retirement meant that the so-called routine job of dealing with normal retirements -- that is compulsory leavers at normal pension date - often fell by the wayside and the administration of lump sums and pensions to those people has in many cases been delayed.
The output of the pensions system is not just the payment of pensions and lump sums. It includes essential communication with those who are retiring, those who wish to change their investments, the dependants of members who have died, the beneficiaries of pension adjustment orders on separation and divorce, and members leaving service.
This communication is required by the Disclosure Regulations under the Pensions Act. Detailed regulation, which is intended to help and protect the consumer, can sometimes mean that providers and administrators send their communications to be checked out by their legal department so that they can be sure that it is all present and legally correct. But that sort of communication is of no value whatever if it can't be easily understood by the person who receives it. We spend some of our time explaining to complainants matters which have been comprehensively dealt with in letters and other communications that complainants have simply not been able to understand. Today we have taken a leaf out of our own book, so to speak, by publishing a plain English guide for complainants. Regrettably, the Irish is perhaps not so plain in places.
Communication and awareness raising are an important part of what we do. We are conscious that we are funded by the taxpayer and that we need to be seen to give value for money. We have put a lot of effort into modernising and updating our website and we have revised and simplified complaint forms, leaflets and brochures, so that people know where we are, what we do and how we can help them.
I wish to place on record my thanks for the co-operation that we receive from most people involved in the pensions area. That cooperation is not universal -- we have had to conduct a number of prosecutions again last year against employers who failed to give the information that was requested of them. The speed of reaction in some areas can also leave something to be desired. One sometimes gets the feeling that pensions are not regarded as urgent. Very often they are not -- unless they aren't being paid, and paid on time.
The Public Sector Reform Programme suggests the possibility of a merger between this office and the Financial Services Ombudsman. That is currently being examined. Whatever the outcome of the critical review that is now in progress, the staff of the Office of the Pensions Ombudsman will continue to show their flexibility and adaptability in a rapidly changing environment. On that note, I want to record my own thanks to my staff for their dedication, hard work and above all, their flexibility and their approach to problem-solving.
I thank you, Minister and your officials for the generous support that has always been shown to this office by your Department, while continuing to respect the independence of the decision-making process which is fundamental to the idea of an Ombudsman.
Finally, I want to thank you personally for being with us today. We greatly appreciate your presence and your continued support for our work.