Seán Haughey (Dublin North Central, Fianna Fail)

The purpose of the transfer order provided for in the Bill is to give effect, on the date of effect set out in the order, to the transfer of the assets of a pension fund to the National Pensions Reserve Fund. As the Minister of State, Deputy Mansergh, said on Second Stage, each of the funds carried out an actuarial valuation of its assets and liabilities at the end of 2008. This has given us an accurate picture of the state of the funds. The funds may have benefited from a slight upturn in asset values over the past two months. Section 10(3) will require a further valuation of the funds to take place on the date of effect of the transfer order. The Minister would like me to advise Senator Twomey that every scheme that is the subject of a transfer order will be required, for FRS 17 accounting purposes, to provide an annual statement of pension liabilities.

The default position for financing public service pensions is that benefits are met on a pay-as-you-go basis. Each year, a contribution equivalent to 1% of gross national product is made to the National Pensions Reserve Fund. The transfer of these pension funds to the reserve fund is line with this model. The issue of the sustainability of public service pensions, which is of wider application than the extent of the deficits in these funds, is being addressed in the context of the national pensions framework. The Green Paper on pensions, which was published in 2007, sets out possible options for the reform of public service pensions. The Government faces the challenge of striking the appropriate balance between employers, people in employment and the State.

I am not disposed to accepting amendment No. 5. Following the transfer of the pension funds, each of the bodies will be obliged under the FRS 17 system to account each year for their pension liabilities. The liabilities will be published each year in the audited accounts of the bodies. The accounts of the individual bodies will also show the pension contributions and payments made by them. Section 12(4) provides for the establishment of an appropriate mechanism, with the approval of the relevant Minister and the Minister for Finance, to account separately for pension contributions. Therefore, the information mentioned in Senator Twomey's amendment will be readily available without the amendment being required.