Lucinda Creighton (Dublin South East, Independent)
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I thank the Minister for being present in the Chamber. Deputy Peter Mathews has submitted this Topical Issue matter every day since 22 October and I want to acknowledge this. It is unfortunate he will not have a chance to speak on it today. Aer Lingus was a State company when these contracts were entered into and when current and deferred pensioners paid into the defined benefit pension scheme. Today the Government has a 25% shareholding in Aer Lingus, so it has a moral duty of care in this respect. What I have encountered from discussing this with pensioners who are on small meagre pensions is that it is the difference between survival and not. It is a most serious issue. It is taking bread from the table of families and older people, in particular in the city but in a wider area also.

Pensioners have been abandoned by Aer Lingus, the DAA and the trade union involved, Impact. It is outrageous that pensioners were excluded from a decision-making process which affected their pensions. Others voted to benefit themselves while excluding those who would take the hit. A total of 70% of Aer Lingus current employees voted to cut pensioners' annual income, starting in January 2015. This is completely out of kilter with any sense of justice or fairness. In other unions, such as teachers' unions, retired members have just as much influence as and an equal say to those in current employment. It beggars belief that this has happened.

A total of €175 million of the pensioners' defined benefit pension saving fund was redirected without their permission or consent. They were not even consulted. Various figures are circulating, but at least 5,000 retired people are involved and at least 5,000 deferred pensioners and possibly more. It was a unilateral decision which did not involve any consultation, and it was completely unfair. Pensioners themselves had no involvement whatsoever in any of the resolution of the Irish airlines superannuation scheme, IASS, deficit negotiations which led to this decision on cutting their income. They are the only group of members of the IASS pension scheme to whom the employers, namely, Aer Lingus and the DAA, decided not to provide any compensation to mitigate against this cut in their yearly pension.

This is all at a time when the Aer Lingus share price is rising. What is most reprehensible is that the price of Aer Lingus shares rose fairly substantially when ICTU told the company the ballot had resulted in a 70% vote in favour. This had a direct impact on the value of shares in Aer Lingus, which is extraordinary.

A 10% cut may be perceived to be minor or negligible in some people's minds, but to low income pensioners it is substantial. I could read some of the e-mails and letters I have received. The matter has already been raised in the Dáil by Deputy Clare Daly and others. I received an e-mail-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Sorry Deputy we are over time.

Lucinda Creighton (Dublin South East, Independent)
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-----from a lady who stated that for 38 years she paid into a defined benefit pension scheme which guaranteed a pension. It was all part of the contract, but now she can look forward to a diminished pension and will struggle to pay her bills. It is not acceptable and the Minister needs to intervene.

Paschal Donohoe (Dublin Central, Fine Gael)
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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.

Lucinda Creighton (Dublin South East, Independent)
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Are any of the trustees beneficiaries of the deferred scheme? I do not have the answer, but it certainly arises as a potential conflict of interest.

Aer Lingus is now returning a fairly substantial profit and is doing quite well commercially. However, it seems very unwilling to deal with the problem. The Government has not pursued that issue. I am conscious that this is recently on the Minister's watch. He has drawn attention to the fact that the deficit increased substantially from €344 million to €769 million between early 2011 and March 2013, which was under the watch of this Government. The Taoiseach made some extraordinary comments on the matter in the Dáil in recent weeks. He said that the issue had dragged on for years and had been allowed to drift. However, he did not seem to assume any responsibility for that or provide any solutions. I am afraid that what the trustees recommended to the Minister in November does not offer a solution.

We are aware of the water protest outside the gates of Leinster House today. People are protesting for different reasons - many because they cannot pay and many others not for that reason but because they are frustrated over how the Irish Water quango was established. These are people who are terrified that they genuinely will not be able to pay the water charges. Many of them are living in rented accommodation and cannot pay their rents and have no security of tenure. These are genuine risks.

I believe the Minister has serious concern for their plight, but we need a better solution than what has been put on the table by Aer Lingus and the DAA. We need something much more comprehensive than the trustees' proposal.

Paschal Donohoe (Dublin Central, Fine Gael)
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The Deputy asked me a direct question about a trustee which I cannot answer.

The Deputy asked about the responsibility of the different individuals who have been involved in this. The implementation and management of the pension fund in the first place is the responsibility of the trustees and I have to recognise that. The Deputy asked me what had happened. Nearly four years of work has gone into trying to come up with a resolution to this difficulty. Nearly every labour body or institution of the State has been involved in it. Various difficulties led to the appointment of a group of people who were charged with trying to resolve the issue. An expert panel was appointed to try to do it. Considerable effort has gone in to get it to this point.

I return to the figures with which I began. The scale of the deficit is now between €700 million and €750 million. Some people have suggested that I, having received a communication from the people whose job it is to run the fund that has a deficit of this magnitude, should not do what they believed was in the best interest of the fund. I took this very seriously. I considered all the consequences of what could happen if this resolution could not be delivered. Given all that had happened up to this point, I made the strong judgment that all the alternatives that were facing the fund were considerably worse than what is being faced at the moment. For those reasons I made the decision to enact the legislation that had been introduced because I had to respond to what the trustees of the fund were recommending. I looked at all the other options and consequences for everybody. It is apparent to me at the moment that they would have been dramatically more serious and unknown than what we are facing now.

I am acutely aware of people's concern over their future as a result of this matter. The Deputy asked me a question that I am not in a position to answer. However, if I can secure the information, I will come back to her.