Dáil Éireann Debate, Wednesday - 12 May 2004
45 Ms Lynch asked the Minister for Communications, Marine and Natural Resources if he has received accounts from the ESB showing a decrease in the company’s pension fund by €100 million; if he has held talks with ESB to discover whether the shortfall is due to employees drawing down from the funds, or poor management; and if he will make a statement on the matter. [13699/04]
View answerI am not in a position to comment on the ESB annual report and accounts until they have been presented to the Government. I am aware that the evolution of share values in recent years, together with the implementation of FRS 17, is causing problems for pension funds generally, including those of commercial State bodies. The response to such problems is a matter for the companies, pension fund trustees and employees in the first instance.
When ESB published its last set of annual accounts for year ended 2002, the company, in line with best accounting and reporting practice, included the additional disclosures required by financial reporting standard 17 retirement benefits, FRS 17. At that stage, the disclosure was required only in the notes to the accounts and note 23 on page 76 of the 2002 annual results reflected this new disclosure format. Full implementation of FRS 17 will only start to apply from 31 December 2005.
Valuations prepared in accordance with FRS 17 require scheme assets to be recorded at market values at the balance sheet date. These valuations are not indicative of the long term funding position of the scheme, which is formally assessed by way of a triennial actuarial valuation.
An actuarial valuation of the scheme fell due as at 31 December 2003. This exercise is currently being completed by the company. When concluded, a more up-to-date picture of the status of the pension fund will emerge.
