I had hoped to get it to the Seanad tonight. Of course, the House must do its job. Let me start with Deputy Wilson's point. I was not sure whether he was speaking with complete infallability following today's episcopal announcement. In relation to Irish Shipping, it is my clear understanding from information we have received that in respect of two out of three categories of workers the status of the pension fund, based on contributions, is basically sound and they will get their full entitlement in line with what they had contributed to the fund. I can make other details available later if the Deputy wishes. In view of the fact that these people were employed in a State company and had certain expectations we should do the maximum possible, within the constraints of the law, to meet their present position. Members opposite will appreciate that I am somewhat constrained in what I say because of the fact that there is a liquidator there. However, that is my view and I will argue it in the relevant places.
Deputies have quoted me fairly in relation to the intent of the EC directive about pension funds and entitlements and workers pay. The directive imposes an obligation on member states to move in this direction. However, it is not an immediate obligation; it is an intermediate one. We are meeting our requirements under the directive by covering the types of payments which are covered in this legislation.
We are seeking to meet in an intermediate manner the objective of covering pension claims and entitlements of workers in the workforce. It is our considered view, as it is the view of many other EC members, that the most effective way to do this is through a pay-related national pension scheme. The House will have regard to the fact that in this instance we are talking about the establishment of a fund which would be contributed to exclusively by employers to cover workers' entitlements to arrears of money. They will be comparatively small amounts but their non-payment could cause considerable aggravation or loss in some cases. That is what the fund is aimed at doing and that is why the contribution is at the level it is.
The Opposition spokesman on Finance was forthcoming in his willingness to contemplate a financial commitment to cover pensions. My information is that we will be coming back during the lifetime of this Dáil to put a national pay-related pension scheme before the House. Obviously any such scheme will have an element of contribution to it from the employer and employee. If those who are in paid employment, self-employer or otherwise, are to make a contribution and express solidarity with those who through no fault of their own lose their pension entitlement, it is reasonable to think that the fund that would go towards providing such a front of solidarity would be funded by both employers and employees. That is not the case in this fund. As a consequence, if we were to extend the scope of this fund to cover the provisions Deputies O'Kennedy and Ryan referred to, the impact on this fund and the consequent imposition of what would be in effect a pay roll tax would be substantial. For that reason I cannot meet the amendment. However, it is intended to bring forward a proposal and that was outlined in the national plan and in the Joint Programme for Government. It is something to which the Minister for Health is committed. Work is going on at present on that. It is quite complex to interact the various types of pension contributions.
In far too many cases where workers make a pension fund contribution, or alternatively where employers deduct a contribution from their salary, there is not adequate overseeing of the administration of the pension fund. In some cases there is no fund as such but a contribution is taken from the employee and put into the current account, so to speak, of the company and pension liabilities are paid as they become due. That is the way it operates under the Civil Service pension scheme. It is arguably not the best way to do it, but that is another day's work. There is an obligation on trade union representatives and public representatives, but specifically on workers who are paying into a fund, to ensure that there are proper trustees appointed to oversee the fund and that the fund is adequately funded. If it is not adequately funded they should be made aware of that and given the option of either increasing their contributions or making alternative arrangements. In many cases the undoubted injustices that arise are because workers, trade union representatives or employers failed to meet their obligations.
I covered the case of Irish Shipping and our obligations under the EC. It is an interim requirement under the directive which we propose to meet. We will meet it under the framework of a national pay-related pension scheme and not out of this fund because of the nature of the funding of this fund and the impact it would have on costs if we were to meet it through the amendment put forward by Deputy Ahern.
The safeguarding of pension contributions and funds is an obligation in the first instance on those who are members of the pension fund or trust. They should make sure, as far as they can, that there is a fund and that there are proper trustees. Under this Bill where an employee has had contributions deducted from his or her salary at source which were deemed to have been paid or credited to the pension fund but which in reality had not been paid by the employer, this fund will make good contributions up to a maximum of the previous 12 months in order to bring the pension fund contribution up to date. The pattern in some companies, particularly in private companies, is when they get into cash flow difficulties revenue of this kind is used as working capital. In this instance what we are saying is that, in so far as they are pension contributions deducted from employees up to a maximum of 12 months previously, they will be fully credited out of this fund to whatever pension scheme the person was making a contribution to in the first place. That is as far as we can go. The logic of that is within the spirit of saying that this was money which was deemed to have been paid and deducted from workers in the first place.
