SIPTU has said it has very serious concerns about the new pension arrangements for the self-employed, which were outlined by the Minister for Finance on Thursday. The measures, which give the self-employed an alternative to the compulsory purchase of annuities and increase the amount of tax-free contributions they can make into pension funds, could seriously undermine the security of future pensions, the union said. Some increase in flexibility was needed and would probably have been welcomed but the new measures, to be included in the Finance Bill, go too far, it said.

"The Minister appears to have gone completely overboard, judging by the degree of deregulation he has now proposed," Ms Rosheen Callender, the union's national equality secretary and a member of the Pensions Board, said.

"Instead of giving a few inches leeway as requested, he has given several miles with potentially dangerous and damaging consequences for future pensioners and indeed future taxpayers."

SIPTU is critical of the minimum amount that must be invested in an Approved Minimum Retirement Fund (AMRF) before the individual can make his own investment choices. The £50,000 minimum amount would currently provide an income of about £3,300 a year or less than £64 per week, it says.

"This is not an adequate weekly income, by present standards. In the event of it becoming a pensioner's only income - which, in extreme cases, could happen - it would not be sufficient to preclude the person from requiring and receiving a non-contributory social welfare pension."

Self-employed people becoming eligible for such pensions would be an unwelcome reversal of the longstanding policy of successive governments to reduce the dependence of the self-employed on such pensions and ultimately on the tax payer, the union believes.