26 Jun 2022

ISME is calling on Tipp workers to support crowdfunding campaign to back High Court challenge on pensions 


Differences between Laois Fianna Fáil and Fine Gael TDs on pension changes

"Private sector workers are not treated in a fair or balanced way when they try to save for a pension." - Neil McDonnell, CEO of ISME

"Private sector workers are not treated in a fair or balanced way when they try to save for a pension." - Neil McDonnell, CEO of ISME

The Irish SME Association (ISME) has initiated an innovative campaign to raise funds for a legal initiative to create an equitable system for private sector pension savers.

By way of crowdfunding, ISME intends to raise €500,000 and is calling on PAYE workers, professional groups, trade associations, trade unions and SME owners in Tipperary to support three plaintiffs who will challenge tax discrimination against private sector workers before the High Court.  

The funds raised will support the formation of a technical team giving tax guidance, pensions expertise, actuarial assistance together with tax and constitutional law advice for the pension’s equity challenge. It is intended to initiate proceedings in the High Court this year. 

The last Public Service Pay Commission report found that while there is almost 100 per cent pension coverage in the public sector, the overall figure for the private sector is just 40 per cent. Workers in the private sector who aspire to a pension even close to that enjoyed by a public sector worker earning the same salary, would have to surrender more than a third of their salary.

Even if they could afford it, our taxation rules constrain them from doing so. Our taxation system permits only third division pensions for private sector workers. 

ISME is calling on business owners and individuals within the SME business community for private donations of €100, or whatever donors can afford, to support the challenge. As the biggest beneficiaries of this challenge, we call on pension providers to donate a minimum of €10,000 each.

ISME also will engage with private sector workers, pension trustees, pension brokers and other interested parties who have raised this issue previously, to build the necessary funds.  

As part of its planned Court action in pursuit of fair treatment for private sector workers with the existing plaintiffs, ISME will pursue a number of objectives, including: 

ensuring private sector workers are not penalised for trying to save a pension pot of equivalent value to that which is provided to a public sector worker for little (or no) contribution; 
to allow private sector workers to save what they feel is appropriate to give them a decent standard of living post-retirement; 
ensuring that there remains an incentive for private sector workers to save money for their pensions; and 
minimising the burden on society caused by the pension deficit. 

Neil Mc Donnell, CEO of ISME said: “Private sector workers are not treated in a fair or balanced way when they try to save for a pension. As far as is possible, private sector workers and SME owners should enjoy parity with public sector workers in our pensions system. We are calling on private sector workers to support this campaign. Every private sector pension saver will benefit from a successful court challenge and we are asking for funding support so this can be achieved. It is ironic that those in the public service who declare tax relief on private pensions to be “tax expenditures” are themselves the beneficiaries of an enormous transfer of wealth from private sector workers to the public sector. Tax relief on private sector pensions savings is tax deferred, not tax avoided. With the support of the SME community, we have a great opportunity to fix this and to ensure a fair pension system on behalf of private sector workers.” 

For further information and to support the Pensions Equity Challenge, visit the GoFundMe page here: pensions-equity-

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