Firstly, I must again make it clear that the IASS and its funding are primarily matters for the Trustees, the companies participating in the scheme, the scheme members and the Pensions Authority.
The Expert Panel established last year was tasked to find the fairest way to distribute the burden of resolving the current deficit in the scheme. As a result of that process, the total contribution proposed by the employers aimed at resolving the IASS difficulties amounted to over €260m. This included almost €20m in extra funding proposed by the employers in addition to the €40m already made available for deferred members, bringing the full amount for this group to €60m.
Prior to signing the Commencement Order in November last year and following requests on behalf of deferred members for additional funds to be made available by the employers, I contacted the employers who confirmed that the funding proposed was the maximum that could be achieved. It should also be noted that there is no legal obligation on the employers to increase their contributions in the IASS.
The funding solution proposed by the IASS trustee was approved by the Pensions Authority and was implemented on 31 December 2014 with the freezing of the scheme and a reduction in pensions. The IASS trustee made it clear to me that it considered that these measures were in the overall best interest of the members of the IASS as a whole and were fully compliant with National and EU law.
The reason for the State having any role at all in this private scheme was to facilitate an outcome, which, although not ideal, was preferable than the alternatives, including the likelihood of a wind-up of the scheme.
I understand that the deferred members are particularly affected by the coordination of their pension with the State pension as they have left service. However, while there may have been an expectation of uncoordinated pensions, the reality is that uncoordination was neither funded by the members nor the employers. Only those members who have paid for uncoordination will maintain that under the current provisions. There are no funds available to mitigate the loss of this element of the proposals.
I am very conscious of the difficulties these necessary changes cause for many scheme members, including the deferred members, and I want to emphasise that the decisions I have made with regard to IASS have been taken with the best interests of all members in mind.
