Finian McGrath
Question:340. Deputy Finian McGrath asked the Minister for Social Protection her views on correspondence (details supplied) regarding an amendment to the Pension Bill. [55248/13]
View answerWednesday, 15 January 2014
Questions (340)
Written answers
The Deputy will appreciate that it is not appropriate for me to comment on matters relating to an individual pension scheme.
The Social Welfare and Pensions Act 2009 broadened the options available to the trustees of a pension scheme in the event of the restructure of scheme benefits to include the benefits of deferred scheme members and post retirement increases in such benefits. Prior to the 2009 Act, only the benefits of active scheme members could be considered in a restructure of scheme benefits. The Social Welfare and Pensions (No. 2) Act further extends the options available to trustees of a scheme to include a portion of benefits payable to pensioners. It essentially provides for the sharing of the risk of scheme underfunding across all scheme members. However, the legislation restricts the extent to which pensioner benefits can be restructured as it is considered that this group of beneficiaries, being already retired, has least potential to make up losses due to a restructure of scheme benefits.
The changes in respect of deferred members are not an unintended consequence. This group is treated the same as active scheme members for the purposes of section 50 of the Pensions Act. A deferred scheme member is a scheme member who has left employment to which the scheme relates and who is entitled to a pension payment at a future date. A deferred member may be close to retirement or may be many years from retirement age and may have the opportunity to accumulate pension entitlements in a number of pension schemes before reaching retirement age.
The issue of how these changes might be applied will be a matter for the trustees of the scheme who are required under trust law to act in the best interests of all scheme beneficiaries.
Any consideration of a restructure of pension scheme benefits under section 50 of the Pensions Act must comply with the provisions in the Act and with guidance issued by the Pensions Board. The Pensions Board must be satisfied that these provisions are complied with before the Board will consider issuing a notice to restructure scheme benefits.