23 March 2023
Chair RTÉ Retired Staff Association
By Email: email@example.com
I acknowledge receipt of your submission to the Pensions Authority which has been copied to me and to the members of the RTÉ Board.
It is correct to say that RTÉ has sought approval for a regulation change to allow that the Scheme be required to carry certain of its own administration expenses. That approval has been refused and RTÉ has appealed that decision. RTÉ has always been a strong supporter of the RTÉSA and has provided support to the Scheme in terms of covering the cost of all advisory services the Trustees have obtained over the years, with no limitations put on these costs. This has allowed , for example, the Trustees to carry out annual actuarial valuations, obtain extensive legal advice in relation to individuals and wider legal issues pertaining to the Scheme as well as engaging a range of consultants to advise on such matters as IORP II, GDPR and strategic issues. The Scheme is now in a very healthy financial position – the excess over the funding valuation bases, allowing for future pension increases was €193 million as at 1 January 2022 – and therefore we believe the Scheme can afford to pay for the consultancy and advisory services they consider beneficial to the operation of the Scheme, without any negative impact on the beneficiaries of the Scheme.
It should be noted that RTÉ is not seeking that all of the costs that it covers in relation to the Scheme should be borne by the Scheme. The following are the costs that RTÉ requests that the Scheme bears:
• Actuarial advisory costs
• Legal fees
• Audit fees
• Other consultancy fees
• Trustee special projects
RTÉ will continue to bear the following costs:
• Administration of Benefits
• Provision of Pension Payroll services
• Secretarial Services
• Record Keeping
• Costs incurred by RTÉ related to RTÉSA issues
In particular, it should be noted that there is no intention to “outsource the core administration role of “Registered Administrator”” as stated in your letter. Nor is there any risk to the tax approved status of the Scheme.
This request for a regulation change was supported by the Trustees although this support was not a pre-requisite to RTÉ’s request.
RTÉ is very conscious of the fact that pensioners have only received one increase since 2008. It has, at every stage, supported the requests for increases, and continues to support and advocate for regular increases for pensioners of the Scheme. The Board understands that RTÉ and the Trustees are working with DPER towards this end. RTÉ does not believe that the costs which it is proposing that the Scheme bears (which come to approximately €300k per annum at present and amount to (0.2% of the Scheme’s assets) will impact on the ability of the Scheme to pay ongoing increases to pensioners. In arriving at the €193 million excess at 1 January 2022, a provision of €20 million had already been made by the Trustees for these future expenses. Even if the Trustees increased their advisory / project expenses to €500k per annum, the provision is still more than sufficient to cover the remaining lifetime of the Scheme.
The appeal is currently with the Department and we have no doubt that the regulation change will not be approved if the DPER are of the view that it would pose a risk to the pensioners of the Scheme.
The Board has considered the concerns raised by you in relation to conflict of interests and we are confident that the Trustees of the Scheme act in accordance with their fiduciary duties and in the best interests of the Scheme.
Siún Ní Raghallaigh
RTÉ Chair / Cathaoirleach