In April 2021 the Irish Government transposed the EU Directive IORP II into Irish law under the European Union (Occupational Pension Schemes) Regulations 2021.
These relate to the activities and supervision of institutions for occupational retirement provision. As specialists in the pensions sector, Mazars is well placed to advise our clients in relation to the impact of the IORP II requirements on pension schemes/Master Trusts such as those relating to external audit, internal audit, risk management, governance or internal controls & procedures.
Guidance from the Irish Pensions Authority stated that “IORP II sets minimum standards for the management and supervision of pension schemes in order to protect the entitlements of members and beneficiaries. It is important to recognise the significance of these changes for Irish pensions. The objective is to improve the outcomes for members of Irish pension schemes, but many schemes will need to do a lot of work to meet the standards and obligations set out in these new provisions.
IORP II introduces many new obligations on Irish pension schemes including:
- minimum qualification and experience standards for trustee boards;
- the appointment of key function holders for risk management, actuarial and internal audit;
- requirement for written policies on risk management, internal audit, remuneration and, where relevant, actuarial and outsourced activities;
- standards for internal controls, administrative and accounting procedures, contingency plans; and
- communications and information to be provided to active members, prospective members, deferred members, those nearing retirement and pensioners.
The Pension Authority has already issued an overview of key themes of transposition including how the Authority will oversee IORP II compliance and the effect of derogations and transitional periods. It also proposes issuing guidance in the form of a Code of Practice on what the Authority expects from regulated entities to meet their obligations under IORP II and guidance for the public and employers about the minimum standards they should expect from master trust vehicles.
European Union (Occupational Pension Schemes) Regulations 2021