Further Delays to The Implementation of Auto-Enrolment and The True Cost of Lost Investment Years…

Earlier this week, Minister Jack Chambers announced that the introduction of auto-enrolment is now likely to be further delayed until early 2026. Since the idea of auto-enrolment was first mooted by Minister Séamus Brennan in 2006, there have been multiple delays including:

2012: Programme for Government included a commitment to implement auto-enrolment. No implementation followed during that Dáil term.

2018: Minister Regina Doherty published the “Strawman Proposal” for public consultation. Launch target set for 2022.

2019–2020: Government reiterated the 2022 launch target. However, planning and system design delays meant no legislative or operational progress.

March 2022: Revised timeline proposed, with launch pushed to January 2024. Draft scheme design confirmed and public communication began.

September 2023: Government announced a further delay, shifting implementation to September 2024. Cited administrative readiness and coordination with Revenue systems.

January 2024: Original revised launch date missed without formal commencement. Delay confirmed by Department of Social Protection.

February 2024: New official start date announced as 30 September 2025. Enabling legislation signed in March 2024.

April 2025: Minister Jack Chambers announced another delay, stating the scheme would not commence in September as planned, but rather “a small number of months” later — likely early 2026.

Like many in our profession, we have significant concerns about key elements of the auto-enrolment system in its current form. This blog explores one of the most overlooked costs: the long-term impact of not being invested in global markets over the past two decades.

Start Your Pension Early – The Cost of Waiting

Imagine turning 65 and realising your pension pot could have been twice as large if you’d started saving 20 years earlier. For many, this isn’t theoretical — it’s a costly reality.

The Numbers: Starting at 25 vs 45

Let’s assume a monthly pension contribution of €200, with a 7% annual return*.

Result: A 20-year delay leads to a €420,000+ shortfall, despite contributing just €48,000 less.

What If You Want the Same €525,000?

Starting later costs over 2.5x more in monthly contributions — often unrealistic for most families at that life stage.

Tax Relief: Boosting Savings with Government Help

In Ireland, contributions qualify for tax relief at up to 40%. This means:

• Contributing €200/month only costs €120 net (assuming 40% tax relief).
• Over 40 years, you invest €96,000 but only feel a cost of €57,600.
• Starting at 45? You lose out on €19,200 in potential tax relief alone.

Risk and Flexibility: Time Is a Strategic Asset

Younger savers can afford to invest more aggressively, typically earning higher long-term returns. Starting late often means a more conservative approach — reducing growth potential.

Real-World Trade-Off

It’s common to delay pension contributions due to other financial priorities — mortgages, childcare, or paying off student loans. But delaying requires you to save more aggressively later, often when expenses are highest.

Conclusion: The Sooner You Start, The Less You Strain

• Early saving means lower monthly contributions and higher end value.
• You benefit from compounding, tax relief, employer contributions, and market growth.
• Waiting costs not just money, but options later in life.

Whether you’re 25 or 45, starting now is better than waiting another year. Don’t wait for the Government to introduce auto-enrolment – and don’t be surprised if we see further delays to the introduction to auto-enrolment in 2026!

If you’d like to explore what starting now could mean for you, or how to catch up efficiently, we would be happy to help you model the options.

*Note: The world markets have delivered an average return of approximately 9% per year over the past 100 years or so, however in this blog, for prudency purposes, we have assumed that the average annual return going forward will be just 7% (meaning that the figures in this blog underestimate the truest cost of delaying your pension). “Past performance is not a guide to future returns…”