Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I thank the Deputy for raising the matter. I know other colleagues have sought to have it selected. In responding to the points I will begin by stating I am deeply aware of the impact of the proposed changes on many people. I have met them and read a huge amount of correspondence from them. I have heard at first hand the personal consequences of this crisis for them and their prospects for the future. The plight they face and the scale of difficulties present in the fund weigh heavily on me.

In framing my response to the Deputy, I want to begin by emphasising a number of points on where it stands at present. Legal responsibility, and responsibility with regard to resolving this great difficulty, is primarily a matter for the trustees, the company, the scheme members and the Pensions Authority. The Deputy did not touch on the scale of difficulty in the fund, but I am sure she is aware of it. In 2011 the deficit for the fund, which is the largest fund of its kind in our country, was €344 million. In March 2013 it was €769 million in deficit. I understand that at present the deficit is approximately between €700 million and €750 million, with the potential to affect up to 15,000 members.

I have thoroughly investigated where it stands legislatively. Based on the minimum funding standard available from the IASS actuaries in December 2013, the estimated coverage for deferred as well as active members' benefits is approximately 24% to 31%. This is what people would have claim to in the pension fund. This takes direct account of the 2013 pensions legislation allowing reductions to be made in pension payments. I completely understand the initial level of pensions which many people have at present is modest after many years of work. This pension fund, which sources pension payments, now has a deficit which we estimate to be between €700 million and €750 million.

With regard to the process the Deputy described, an expert panel was established. As a result of this process the total contribution proposed by the employers aimed at resolving the difficulties now amounts to €260 million. With regard to the point made by the Deputy on the lack of a share of this additional money for deferred pensioners, it is an increase of €20 million on what was proposed by the original employers, in addition to the €40 million already there, bringing the proposed amount to be available to deferred pensioners to €60 million. On Friday, 14 November, the trustee sought approval from the Pensions Authority for a funding proposal and requested me to commence provisions to facilitate implementation if approved. The trustees confirmed they believed this was in the best interests of the fund. This was also the view of the expert panel.

Having considered this and reflecting on all the issues involved in such a significant deficit, I signed the order. Had I not signed the order - this was done with the support of Government - it would have posed an unquantifiable risk to the entire scheme, which would have had profoundly serious implications for all members of it.

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