Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

I have no doubt the Minister is trying to reform the system and he is committed to that but time is of the essence. The current minimum standard overstates schemes' liabilities and acts as an incentive for employers to welsh on their responsibilities. That is basically it. It is clear that fund liabilities are calculated on the basis of annuity prices, as we stated in the House on the previous occasion. Is the Minister aware that the UK pensions regulator has stated that calculating DB pension deficits on a buy-out basis is misleading, reflecting exceptionally low bond yields and the cost of capital buffers and a profit margin for insurance companies? The same is happening in New Brunswick in Canada, which we read in an ICTU document. It is clear that it is not in the interests of members of DB schemes to force them into a dysfunctional annuity market which will not provide a stable pension. Does the Minister agree that as long as his Department clings to the bond and annuity-based liability calculations, most DB schemes will be subject to damage and volatility and will continue to be driven towards unnecessary wind-up? That is what is happening.

How integrated pension schemes interact with the State pension age is another major issue. Integrated schemes are where pensioners receive benefits from both the scheme and the State at age 65 and, as it goes on for a number of years, pensioners can lose out on anything up to three years, depending on whether the State pension age is increased up to the age of 67 or 68. That is a major issue and I ask the Minister to take account of it.

ICTU has sought a stakeholder forum involving all the relevant bodies, including the Minister, to whom I understand it has made that point. That might be a way to make an adequate and appropriate contribution in this respect and he may well find that it will be very useful in what he is trying to achieve. I applaud the Minister for what he is doing.

See this speech in context