AN ATTEMPT by social and family affairs minister Mary Hanafin to allay public fears about the possible collapse of pension funds has been compared to Marie Antoinette's advice to peasantry in pre-revolutionary France

Last week the Sunday Tribune exclusively revealed Hanafin had warned the government about a deficit of €20bn to €30bn in pension funds. Ninety percent of private pension funds will this year fail to meet the funding standard required of them by the Pensions Board, Hanafin warned.

Within hours of the story breaking, Hanafin made a number of media appearances to reassure people about their pensions. She said if a person's private pension plan fails they will always have the state pension scheme to fall back on.

During a special adjournment debate on pension funding in the Dáil last Wed­nesday night, Labour's Joan Burton said: "The minister's suggestion that people would always have the state pension to fall back on anyway was insensitive to say the least.

"During its 11-year reign in power, Fianna Fil has continually talked about pension reform but done nothing…

"It is extraordinarily high-handed of the minister to wash her hands of the issue and casually remark that 'most of these people would have a state pension – €230.30 per week – and the state pension is a good guarantee to fall back on'. That smacks of Marie Antoinette and her advice to the peasantry of pre-revolutionary France, 'let them eat cake'."

Hanafin responded: "I set out to allay people's fears in subsequent media interviews by pointing out that no pension fund has gone bust and no pensioner has been left without a pension. However, we know there are some who are bound to experience difficulties given the current state of the market."

Elsewhere, the minister for finance Brian Lenihan has loosened pension rules to help people caught by the downward spiral of world stock markets.

Since last Thursday, members of defined contribution pension schemes (which are most at risk, according to the leaked memo) will be allowed to defer for up to two years the purchase of an annuity.

Defined contribution scheme members are generally required to purchase an annuity ? which is an insurance policy guaranteeing a set income for life ? on the date they retire but the recent collapse in markets has led to substantial losses in funds.