13 September 2018
Ms. Regina Doherty
Minister for Employment Affairs and Social Protection
I am writing to you in connection with the Social Welfare, Pensions and Civil Registration Bill 2017, currently before the Oireachtas. The views expressed in this letter represent those of a collective group of pensioners, all members of Defined Benefit Pension Schemes in semi state organisations listed in Appendix one of this letter.
While there are some positives to be taken from the Bill as it is currently proposed:
• Employers cannot abandon Pension Schemes at short notice.
• Defined Benefits pension schemes will be more frequent monitoring by the Pensions Authority.
However, our group has serious concerns regarding the other proposed elements of this Bill:
There is no sanction to prevent an Employer “walking away” from their Pension Schemes after the 12-month notice period.
Too much control over Defined Benefit pension schemes rests with the Employer.
• There is no guaranteed protection for the value of pensions.
• There are no financial consequences for an Employer closing a defined benefits scheme.
• There are no proposals to relax the very stringent MFS Regulations.
In a year when the Government has launched the “Roadmap for Pensions Reform” and proposes to introduce auto enrolment for a new Government backed Pension Scheme in the next few years, it is imperative that full and proper protection is enshrined in Irish law without further delay.
It is unreasonable to expect workers to sign up to a new State Pension Scheme in the absence of meaningful protection for retirees depending on existing semi state pension schemes.
There must be consequences for Employers who abdicate responsibility for their Pension Schemes and fail to make contributions to resolving deficits that arise in their Schemes. That consequence should be a resulting debt on the Employer for the amount of the unresolved deficit. Both Company and Shareholder control and influence on defined benefit schemes must be fully aligned with associated accountabilities to these schemes. In the majority of these schemes, the Shareholder is the Government Department.
IBEC and the employer lobby must not be allowed to deflect Government from introducing proper legal protection for our current pensioners. These pensioners were required by their employers to participate in and contribute to these defined benefit schemes by contractual obligation as part of their conditions of employment. These employers should now fulfil their obligation to their employees in their retirement.
Pensioners do not have any recognised mechanism or organisation to deal with grievances with their former employers:
The Pensions Authority does not deal with complaints from pensioner organisations, nor does the Pensions Ombudsman. Pensioners require a strong representative voice and access to the Industrial Relations’ Machinery of the State.
Our collective group have the following in common:
• None has received a cost of living pension increase in the past ten years.
• Many members were required by their conditions of employment to pay a Class D Stamp throughout their working life, thus making them ineligible for state pension entitlements.
• Most of them are bearing the consequences of the Government pension levy and now have permanent deductions from their pensions for the remainder of their lives.
This morally indefensible levy on pension schemes must not happen again. Binding legislation is needed to protect the Pension Scheme assets which have been accrued by employees throughout their working lives to provide for their retirement.
• Clarity is required as to who is ultimately responsible for public sector pension schemes – the companies or the State? There are variations in each of these schemes in how they are governed and in how much oversight is involved by Government Departments.
All of the above are important issues for our group and we need absolute guarantees that our concerns will be addressed in the forthcoming amendments to the Bill.
We are conscious that you are anxious to progress changes to some aspects of defined benefit schemes and, while we would like to bring our concerns to the Committee on Employment and Social Affairs, we would request first an urgent meeting with you. Given that the Bill is at an advanced stage and that a window of engagement is limited, we look forward to hearing from you.
RTE Retired Staff Association (DB)
ESB Retired Staff Association
Bord Na Mona Pensioners Association
Bord Gais Pensioners Association
CIE Pensioners Association
AOEP (Eircom Pensioners Association)
Retired Aviation Staff Association
Coillte Retired Staff