Conscious of the impact on industry, the Pensions Board committee sensibly decided it hadn’t had enough time to assess the virtues of mandatory pensions. Such a scheme has no support from employers, and very little from the pension industry, though Seamus Brennan has made it no secret that he sees merit in the idea.
If the last reform of the pension system is anything to go by, nobody should hold their breath for implementation of any of the recommendations: it took about seven years from the start of the original national pensions policy initiative (NPPI) to the introduction in 2002 of the personal retirement savings accounts (PRSAs) that the Pensions Board now wants redesigned.
The PRSA never had a chance. It was too complicated and was launched at the same time as special savings incentive accounts (SSIAs). The suggestion that it be transformed into a quasi-SSIA, with cash top-ups instead of tax relief, is a good idea.
Likewise, extending 42% tax relief to pension scheme contributors, regardless of income, might also increase pension coverage, but it would hardly be “cost- neutral”, a key requirement of the Department of Finance.
It will be a coup for the Pensions Board if its recommendations are adopted, but Brian Cowen, the finance minister, has already let it be known that he wants lots of “blue water” between the end of SSIAs and restyled pensions.
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Time is also running out if maturing SSIA funds are to be rechannelled into pensions.Unfortunately, this is not an industry (or legislature) noted for its fast reaction times.
So much effort, so little point
While millions of euros are being sucked into a pyramid scheme in west Cork, up the road in Birr, Co Offaly, and in the capital, the director of consumer affairs has been prosecuting grocers for failing to display the price of tea bags and cream crackers properly.
Last month, it was forecourt retailers not displaying the price of Mars bars. This time, five convenience stores have been taken to court for not posting, for example, the cost of a packet of Boland’s Cream Crackers in kilograms, or for displaying the price of Bewleys Clipper Gold Tea Bags at €2.49 but charging €2.99.
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I know it is the director’s job to police prices. Somebody has to do it. But is the cost of investigating and prosecuting a handful of shopkeepers for such tiny infractions — and sending out crowing press releases — worth the cost in time and resources? Carmel Foley says these prosecutions “should send a message to all retailers that they must display their prices or run the risk of being brought before the courts. Consumers have the right to know the prices of goods before they go to the checkout. This is essential so they can make informed choices whether to buy or to move their custom elsewhere”.
I am familiar with two of the offending retailers, the Londis Topshop on James’s Street and a Spar on the South Circular Road. Both seem to be clean, bright, well-stocked, long-opening if pricey establishments (like all convenience stores). I’ve never noticed if they haven’t always posted the correct price on every item. In my defence, m’lud, when the dog is going hungry and there’s no milk for breakfast, you just pay what the nice kid behind the till tells you to.
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Bargain-hunting at the banks
Fixed-rate mortgages are a mixed blessing. For the hard-pressed first-time buyer, such a loan offers price stability for a few years. For the nervous investor who loses sleep at the mere suggestion of interest-rate movement, a fixed rate can prove an expensive refuge if they time their contract badly. Just ask anybody who fixed for five or seven years at 9% in the early 1990s.
That said, with interest rates going up, I can understand why it makes sense to consider fixing all or part of a mortgage for two or three years (I think five is too long). But switching to a new lender will cost you money.
National Irish Bank has just rolled out low-cost two-, three- or five-year fixed rates, plus €1,000 to help pay legal fees, for anybody switching a mortgage worth at least €100,000 to it by the end of February. NIB expects the next 0.25% ECB increase to come in March.
The €1,000 isn’t particularly novel, but keeping the rates at 3.29%-3.45% when most other banks have already raised theirs is a good, competitive offer. Customers need to keep their eyes open for more special deals this year. If the first three weeks of the new year are anything to go by, there are going to be a lot more coming on stream.