Jim McDaid (Donegal North East, Fianna Fail)

The purpose of section 9 was raised in the Dáil. It involves superannuation schemes in Aer Lingus and Aer Rianta and contains 17 subsections. My response to the Senator's amendment relates to superannuation schemes in general.

The sole purpose of the section is to provide that Aer Lingus may establish its own pension schemes at some stage. While the section is long and complex, running to 17 subsections, this merely reflects the complicated nature of pension scheme provisions and the need to ensure that if and when Aer Lingus establishes its own scheme, the rights entitlements and obligations of Aer Lingus employees or former employees under the existing scheme will be preserved under any new scheme. It is not feasible for Aer Lingus to establish pension schemes specifically for former employees and which would have benefits paid out in line with national wage agreements. In other words, it is a matter for the company. Pension payments are made in accordance with the rules of the scheme which also determine the rate of contributions.

The question arises as to where the funds would come from for the scheme proposed by the Senator. If his scheme was introduced, former employees would be in a better position than current employees who pay into the existing pension scheme. It should be noted that following Second and Committee Stages in the Dáil, during which concerns about pensions were raised by the Opposition, the Minister for Finance issued a letter to the Minister for Transport which stated that it was a long-standing policy and principle that pensions in the commercial semi-State sector were a matter for the trustees of the funds, the companies in question and the members of the schemes. The letter continued to the effect that it would be inappropriate for the Minister or this Department to become involved in such matters and that any issue raised should be referred to the company. I understand the Minister read the letter to the Dáil to confirm that pensions were a matter for the company rather than this legislation.