Discussions are under way with the trustees and administrators of the funded pension schemes of the five older universities and a number of non-commercial semi-State bodies with the aim of adopting a new approach to dealing with the liabilities of these schemes. The semi-State bodies involved are the IDA, SFADCo, FÁS, Bord Bia, the Irish Goods Council, the Arts Council, CERT and a number of regional tourism organisations. These university schemes have been closed to new members since 2005 and schemes for post-2005 members operate on a pay-as-one-goes basis. The discussions follow a recommendation by a working group established by the Higher Education Authority which considered the position of the universities' pension schemes.
As the Deputy is aware, all funded schemes must now meet minimum funding standards under EU law unless an appropriate guarantee is provided by the State. This has presented problems for the universities and non-commercial semi-State bodies with funded pension schemes where the Government is, in effect, responsible for the cost of pensions but where this is not clear enough to warrant exemption under EU law. It should be noted, however, that the Government is acting in compliance with EU law.
The schemes in question have been included, pending the conclusion of the discussions with the trustees or administrators of the schemes in SI 295 of 2008, Occupational Pensions Schemes (Funding Standard) (Amendment) Regulations 2008, and are therefore exempt from the funding standard in the Act. It is proposed, if the trustees and administrators of the schemes agree, that the assets of the schemes be transferred to the State with the liabilities, which would then be met, effectively, by the State on a pay-as-one-goes basis in future. The pension terms and conditions of the various schemes would remain the same. If agreement is reached, legislation to give effect to all this would be required.
On the basis of the information available at present, it is estimated that the value of the assets of all of the funds in question at the end of 2007 was approximately €2.3 billion and that, in 2005, the liabilities of the schemes in question were also approximately €2.3 billion. Clearly, these estimates must be updated.
The extent of the liabilities is one of the issues which will be clarified in discussions with the schemes. The liabilities in relation to these schemes are the defined benefits to which the members are entitled and for which the Government is already in effect responsible. Under the proposal, these liabilities will be met by the Government on a pay-as-one-goes basis, in line with the approach taken on public service pensions generally.