A pension expert has predicted the beginning of auto-enrolment could be delayed until 2027. 

The Auto-Enrolment Retirement Savings Scheme means employers and their staff will pay into a pension fund for an individual when they retire. 

The scheme is designed to boost the standard of living of future generations of pensions and is based on similar models in other western countries. 

Earlier this week, Minister for Public Expenditure Jack Chambers said the scheme would likely be delayed by a short period of time due to the impact of US tariffs on the economy. 

On Late Breakfast with Ciara Doherty, CEO Fairstone Paul Merriman said it was “no surprise” that the scheme would not begin as planned in September. 

“I still think even in 2026, you’re only going to see a rollout on a temporary basis or a trial basis,” he said. 

“I think Jack Chambers said it had been delayed slightly, it’s not going to be delayed slightly. 

“This is going to roll until 2026 and probably 2027 by the time you see the full auto-enrolment scheme being announced or rolled out.”

Mr Merriman described this as a “shame” given the Government has been talking about such a scheme for “decades”. 

“They’d be doing well if they launched this scheme fully to everyone who it’s supposed to be applicable by 2027,” he said. 

“You’d probably see a trial basis rollout for certain sectors or employers in and around Q2 of 2026.” 

Future of pensions

Mr Merriman added that he thinks the Government is worried about how effective the scheme will be. 

“There’s almost a fear from the Government that they’re going to fail with the numbers for auto enrolment because you can opt out,” he said. 

“So, the scheme works where you’re automatically enrolled. When you’re automatically enrolled, you have the option to opt out within six months. 

“In fairness, the sweet time to do this would have been probably five or six-years ago before the rise in inflation, before COVID, etc. 

“But you can’t go backwards.” 

A pensioner holding euro coins in his hands. Picture by: Weyo / Alamy Stock Photo

Due to falling birth rates and increases in life expectancy, Ireland has a rapidly ageing population.

It means the State will have to spend increasingly large sums on pensions and healthcare for the elderly - all with a smaller number of working age people who pay taxes. 

Auto-enrolment is designed to mitigate the impact of that demographic change. 

“The State are concerned about running out of cash and being able to afford a State pension for as long as they need,” Mr Merriman said. 

“The expenditure for the State pension has dramatically increased over the last 20-years as people are obviously living longer as well.”

Main image: Hands of an elderly pensioner holding leather wallet. Picture by: Alamy.com