Clare Daly (Dublin North, United Left)
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52. To ask the Minister for Social Protection her views on amending section 50 of the Pensions Act 1990, as amended by section 35 of the Social Welfare and Pensions Act 2012, in order to offer more protection to employees against reductions in their pension entitlements, in view of the growing number of cases like IASS and Tara Mines pensioners experiencing pension cuts when their former employers are not in financial difficulty; and if she will make a statement on the matter. [4905/15]

Joan Burton (Dublin West, Labour)
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Defined benefit pension schemes in Ireland are, in general, set up under trust. The trustees of such pension schemes have a fiduciary duty to act in the best interest of all scheme members.Section 50 of the Pensions Act makes provision for the restructuring of a defined benefit pension scheme where the scheme fails to comply with the Funding Standard. The Pensions Authority can either unilaterally or on an application from the trustees of the scheme issue a direction to the trustees of a scheme to restructure scheme benefits. Such a direction by the Pensions Authority only facilitates a restructuring of benefits which is designed to enable the scheme satisfy the Funding Standard. All directions issued by the Pensions Authority to date have been as a result of an application to the Authority by the trustees of a scheme. Before the trustees make such an application, they must consult with the employer, with the scheme members, with any person receiving benefits from the scheme and with the authorised trade union representing scheme members in advance of an application to the Pensions Authority. The Pensions Authority has discretion as to whether or not to issue a direction following an application by the trustees of a scheme.

The changes made to section 50 of the Pensions Act in recent years essentially provide for the sharing of the risk of scheme underfunding across all scheme members. The issue of how these changes might be applied is a matter for the trustees of a scheme who are required under trust law to act in the best interests of all scheme beneficiaries.

At the end of 2013, the Annual Report of the Pensions Authority indicated that there were 933 defined benefit pension schemes subject to the Funding Standard. The Pensions Authority has issued a section 50 direction in respect of 11% of these schemes. In the majority of applications, the restructuring of scheme benefits related to an adjustment of future increases in benefit.

While I do not plan to bring forward amendments to section 50 of the Pensions Act at this time, I will continue to monitor its application.