Mary Lou McDonald
Question:146. Deputy Mary Lou McDonald asked the Minister for Social Protection her plans to enforce the minimum funding standard on the ESB's defined benefit pension scheme. [35836/13]
View answerWednesday, 17 July 2013
Questions (146)
Written answers
Pensions legislation provides for the supervision and regulation of defined benefit occupational pension schemes and, in that context, requires schemes to meet the commitments they have made to their members. This method by which this is regulated is set out in the Funding Standard, the operation of which is supervised by the Pensions Board.
Section 52 of the 1990 Pensions Act provides that, by way of Regulation, certain defined benefit pension schemes may be exempt from the requirement to comply with the Funding Standard on the basis that “some or all of the benefits under specified schemes or categories of schemes are, or may be, paid in whole or in part out of moneys provided from the Central Fund or moneys provided by the Oireachtas”.
EU Directive 2003/41/EC on the activities and supervision of institutions for occupational retirement provision (the IORPS Directive) provides that a Member State may choose to exempt a funded defined benefit pension scheme from the application of a national funding standard only if the scheme is “made under statute, pursuant to legislation, and is guaranteed by a public authority”. Essentially, in order to exclude a scheme from the requirements of the Funding Standard, the payment of scheme benefits must be guaranteed by the State.
The State does not guarantee or accept any liability for the funded schemes of the commercial State companies.
In this regard, a case has been made by the ESB Pensions Governance Forum to the relevant Government departments seeking exclusion from the requirements of the Funding Standard. This case is being examined at present.