Willie O'Dea (Limerick City, Fianna Fail)
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I thank the Ceann Comhairle for allowing me to raise this very important topic which affects all 10,000 active CIÉ pensioners and all potential pensioners. In 1993 there were five pension schemes in operation in CIÉ, of which three were in deficit and two in surplus. After protracted negotiations, an agreement was reached in 1994 with all CIÉ employees and the company to amalgamate all five pension scheme, thereby allowing CIÉ to remove a potential €73 million pension deficit from its books. In return, the employees were given certain assurances, the first of which was that the board of CIÉ would guarantee the solvency of the pension schemes each year. This assurance was covered by SI 323 of 2002 and SI 205 of 2010. The second commitment given was that there would be regular post-retirement increases, but no specific rate was mentioned. The company adhered to these commitments until 2009 when it failed to provide sufficient funding to ensure the solvency of the schemes in that year and the following years. This was in direct contravention of the advice tendered by the company's actuary. The board of CIE has underfunded the pension schemes ever since and the underfunding now totals about €80 million.

In 2013 flawed and legally questionable proposals to drastically reduce the benefits for the employees of both CIÉ pension schemes were submitted by CIÉ to the Pensions Board. There was no consultation with the workforce or the trade unions and the proposals were submitted as a first resort, without exploring other options. This has resulted in a pay freeze for pensioners for 11 years until 2023. CIÉ's pensions committee for the schemes has consistently refused to confirm that it adheres to all of its legal requirements. CIÉ is now in the process of submitting new proposals to further restrict and reduce pensioners' benefits, again without proper consultation and adhering to correct procedure, having refused for the first time in the history of the company to fund an independent legal opinion to enable the membership to test the legality of what was done and is now being proposed.

I ask the Minister to intervene. The representatives of pensioners and the trade unions have tried fruitlessly to engage with the board of CIÉ. They have been misled, suffered obfuscation, been put off and their questions have been avoided, etc. It was traditional that if there was a dispute of this nature or there were legal questions at issue, the company would fund an independent legal opinion for the benefit of the employees and the company, something which has been flatly refused on this occasion. The only recourse they now have, having been fobbed off by the board, is to appeal to the House and people like me and the Minister. Is the Minister aware of the issue? Does he propose to intervene or do anything about it? Would he, at a minimum, as a prelude to such action, at least meet representatives of the pensioners who feel very aggrieved because their livelihoods are being shredded?

Shane Ross (Dublin Rathdown, Independent)
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I thank the Deputy for raising this important issue. Matters regarding the CIÉ pension schemes are, as the Deputy will know, primarily for the CIÉ group, its employees and the trustees of the pension schemes. The employees of CIÉ group companies, that is, Bus Átha Cliath, Bus Éireann, Iarnród Éireann and CIÉ, are provided with pension benefits on retirement from one of two schemes, the regular wages scheme or the superannuation scheme.

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Both are defined benefit schemes. In common with the overwhelming majority of such schemes, both schemes are facing significant challenges in maintaining solvency to ensure prudent provision is made to fund the cost of future pensions in a low interest rate environment. In 2013, both schemes submitted proposals to the Pensions Authority, as required. The schemes demonstrated a plan that would restore the schemes to the solvency level required by the Pensions Authority by the end of 2023. This is referred to as the funding plan.

The plan consists of three strands. First, there is a funding commitment from CIÉ as schemes sponsor. Second, there is a range of assumptions around future market performance and growth in pension liabilities. Third, there is an investment strategy that would hope, over time, match movements in the value of the schemes obligations with movements in the value of the scheme's liabilities. Each year the schemes' independent actuary reports to the Pensions Authority on performance against the schemes' funding plan. At the end of 2016, due mainly to the low interest rate environment, both schemes were certified as being "off-track", or they had not reached the solvency milestone that had been set in the funding plan for the end of 2016. Arising from the "off-track" certification, the trustees of each scheme are required to submit revised funding proposals to the Pensions Authority outlining the steps being taken to restore each scheme to an "on-track" status. The trustees of the schemes have the obligation to submit revised funding plans.

There is no requirement on the trustees to consult with the trade union group or the active membership before making its submission to the Pensions Authority, and perhaps there should be. CIÉ, as scheme sponsor, considers it preferable to develop proposals on an agreed basis with the membership of the scheme. Accordingly, CIÉ has continued throughout 2017 to engage with the trade union group in order to bring about a set of proposals that could form the basis of the trustees' submission to the Pensions Authority. This process, which involves detailed discussion with employee representatives, facilitated by the Workplace Relations Commission, WRC, is ongoing in an effort to develop proposals on an agreed basis to address the "off-track matter". Some progress has been made but an agreed basis for resolution has not yet been achieved. CIÉ is on record at the WRC that it will not impose any change that it proposes without the agreement of the active members of both schemes and that it will continue to contribute to both schemes in accordance with the rules of the schemes.

Willie O'Dea (Limerick City, Fianna Fail)
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The Minister has stated in his reply that negotiations are ongoing but the truth is that negotiations are going nowhere. I do not know how people in this House would react if we were faced with a proposal to freeze our pensions until 2023 and, in addition, that further restrictions would be introduced.

I will put some specific questions to the Minister and I would like specific answers. He referred to the trustees as being part of the package but is he aware that an independent analysis of the CIÉ pension schemes last year concluded the role of the trustees in the schemes is marginalised and they can be amended without the input of trustees? There is no other scheme where a similar position applies in either the public or private sector. Is the Minister also aware that for the first time in history, there is no functioning pension committee, as all the members have resigned? Is he aware the same individual, whom I will not name, holds the dual role as head of group public relations with responsibility for pensions and the CIÉ board's lead negotiator; in other words, there is a clear conflict of responsibility?

Will the Minister order an independent investigation into what is happening there? Will he direct the board to answer a number of legitimate questions put to him on behalf of the 10,000 active members of the CIÉ pensions schemes? Will he request the board to for heaven's sake resort to the usual practice in CIÉ and fund an independent legal opinion for the benefit of the people who are trying to represent these pensioners?

Shane Ross (Dublin Rathdown, Independent)
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I thank the Deputy for raising these matters. I am happy to refer them to the CIÉ board for their comment. I am not prepared at this stage to give a commitment to fund what he asks for just because the Deputy has raised it in the House today. If there is a conflict of interest, as maintained by the Deputy, I will refer it to the CIÉ board for comment along with the other matters. It would be foolish of me to answer that immediately either in the positive or negative as it is a serious allegation. I should look at it in a serious way but I will not make any judgment on it before I ask the CIÉ board about it.