Dáil Éireann Debate, Wednesday - 18 December 2013
58. Deputy Michael McGrath asked the Minister for Finance if he will provide a breakdown of the way the Mercer report savings are being achieved for each of the Irish headquartered banks; and if he will make a statement on the matter. [54545/13]
View answerAs I stated in earlier replies to Parliamentary Questions on this matter I can confirm that the three State supported banks responded with their individual strategies, designed to achieve the required savings, by the due date of 30 April as requested by the Government in response to the Mercer Report. I was not prescriptive in how this was to be achieved respecting their differing State ownership and investment and paths to profitability. I have reviewed the letters submitted and in light of the various industrial relations developments since then I now am satisfied that the banks will deliver remuneration cost savings of 6% to 10%. The Bank of Ireland proposal focused on changes to the defined benefit pension scheme that will affect all staff who are members of this scheme and as the deputy will be aware an agreement has now been reached with the IBOA in this regard. The AIB proposal included the closure of the defined benefit scheme to future accrual along with other changes including an increase in working hours which were agreed with the IBOA in July. The PTSB proposal centred on the wind-up of the defined benefit pension scheme for all staff who were members of this scheme and this has now been completed.
For clarity senior management in the banks have made the following contributions; in the case of Bank of Ireland the proposed pension changes affect all staff in the BSPF scheme including the Chief Executive. In the case of AIB reductions in pay and benefits of higher earners ranging from 7.5% to 15% were implemented in the second half of 2012 and it also should be noted that the members of the AIB Leadership Team all joined the bank since 2008 and receive reduced pension contributions from their predecessors. In the case of PTSB all senior management joined the bank since 2008 and are on lower remuneration levels than their predecessors.
