Dáil Éireann debate -
Thursday, 29 May 2003

Vol. 567 No. 7

Written Answers. - Pension Provisions.

Richard Bruton

Question:

216 Mr. R. Bruton asked the Minister for Transport if he has received a report from Aer Lingus and Aer Rianta regarding the inability of their pension fund to finance pension increases in line with the pay of serving members; if he has identified the reason indexation in this fund falls so far behind other State companies; if he is open to discussions with the EU Commission regarding the possibility of the State topping up the pension fund of these companies in the event that the State realises some of its shareholding within these companies; and if he will make a statement on the matter. [15058/03]

Minister for Transport (Mr. Brennan)

The pension fund to which the Deputy refers, the Irish airlines (general employees) superannuation scheme, is a multi-employer scheme which includes Aer Lingus, Aer Rianta, FLS Aerospace as well as a number of smaller companies. I understand that Aer Lingus and Aer Rianta have been meeting all of their liabilities towards the pension fund in accordance with the rules of the scheme. These rules do not provide for pension increases in line with salary movements.

However, I am advised that recent practice under the scheme has been to provide pension increases in line with the consumer price index to pensions in payment. These increases are not guaranteed and are not explicitly funded but depend on the performance of the pension fund and are paid at the discretion of the trustees of the scheme. Pension entitlements for employees of commercial State bodies, including Aer Lingus and Aer Rianta, are matters primarily for the trustees, the members of the relevant scheme and the company involved.

The State has no involvement in the funding of these schemes and there is no question of an injection of State funds into any semi-State pension fund irrespective of any considerations regarding a change in ownership. Any such proposal would run counter to established policy in this area and would, in any event, be challenged by the European Commission as a state aid. I have, therefore, no plans to discuss any such proposal with the European Commission.