Dáil Éireann Debate, Thursday - 14 February 2013
201. Deputy Eoghan Murphy asked the Minister for Social Protection her views on correspondence (details supplied) regarding current legislation and the way it could impact on the pension entitlements of current employees in Allied Irish Bank should the pension fund be dissolved. [7946/13]
View answerI am not in a position to comment on any individual pension scheme; however, I am aware of the significant challenges facing pension schemes at this time.
In the event of a scheme windup, the assets of a scheme are distributed in accordance with section 48 of the Pensions Act 1990. The statutory order of priority is of no consequence where a scheme winds up with sufficient assets to meet all of its liabilities. In a wind–up situation where there are insufficient funds to meet all liabilities, all pensioner benefits except post-retirement increases, are given the highest priority after wind-up expenses and additional voluntary contributions made by individuals. The remaining assets are then distributed amongst current and former (not-yet retired) scheme members. The level of scheme funding will determine the extent to which the liabilities of the scheme can be met
I have indicated my intention to change the way in which the assets of a scheme are distributed on the windup of a scheme. A consultation process on this issue was completed in the last quarter of 2012. The consultation process involved engagement with representatives of older people, the pensions industry, employers and trade unions. In addition, my Department engaged external expertise to assess the impact of possible changes on how assets of a scheme are distributed on the windup of a scheme.
The proposals emanating from this process are being considered at present and I will be bringing proposals for change to Government for decision.
