Dáil Éireann Debate, Tuesday - 16 April 2013
653. Deputy Joanna Tuffy asked the Minister for Social Protection the date on which she expects to introduce legislation that will implement changes to defined benefit pension to help ensure the protection of members' benefits; and if she will make a statement on the matter. [17069/13]
Amharc ar fhreagraAs you are aware, there are significant structural and affordability problems with DB schemes due to a range of factors such as an underestimation of longevity, poor investment decisions and the impact of the downturn in financial markets.
A range of both administrative and legislative measures have been put in place since 2008 to assist trustees and employers respond to the impact that the downturn in financial market has had on the funding of defined benefit pension schemes. Following a review of the defined benefit model which was completed in 2011, I introduced a requirement for defined benefit pension schemes to hold a risk reserve which was designed to protect the interest of scheme members against future volatility in financial markets. I also introduced a range of options which will assist trustees of schemes in meeting this requirement. In view of current funding difficulties experienced by many defined benefit schemes, schemes will have until the end of 2023 to satisfy this requirement.
You will appreciate that the issue of how the assets of a pension scheme are distributed on the wind-up of a pension scheme is a complex and sensitive issue and one which requires careful consideration before any change is made to the current provisions. In this regard, my officials have completed a detailed review of these provisions which involved engagement with stakeholder representatives and with external consultants who provided valuable assistance in reviewing this issue.
The outcome of this review is being considered at present.
