I am very aware of the issues arising and very negative consequences caused by the problems in the Irish Airlines (General Employees) Superannuation Scheme (IASS) for all active, deferred and pensioner members and appreciate the difficulties presented to all stakeholders in addressing the significant deficit in this scheme. However, you will appreciate that the funding difficulties in this scheme are primarily a matter for the Trustees, the companies participating in the scheme, the scheme members and the Pensions Authority and I cannot comment on specific issues arising in a particular scheme or schemes.
Defined benefit pension schemes in Ireland are, in general, set up under trust law. From a regulatory perspective the Trustees of pension schemes must comply with the provisions in the Pensions Act 1990 which, among other things, sets down certain requirements in relation to scheme funding. In response to the funding difficulties faced by defined benefit schemes generally, a number of changes have been made to the Pensions Act in recent years to assist employers and trustees respond to the funding difficulties encountered by many schemes. The Pensions Act was amended in 2009 and again in 2013 to broaden the options available to trustees of pension scheme in the context of a restructure of scheme benefits. These changes provided for the sharing of the risk of underfunding in a scheme across all scheme members. The manner in which these options are exercised is a matter for the trustees of a scheme who are required under trust law to act in the best interest of scheme members and beneficiaries.
Should the Pensions Authority become aware that Trustees are not in compliance with the provisions of the Pensions Act, it has the power to investigate the state and conduct of a pension scheme.
I am aware that intense efforts were made over a number of years to resolve the issues arising in the IASS scheme. The funding solution proposed by the IASS, which the trustee group made clear was considered the solution that was in the best interest of the members as a whole, was approved by the Pensions Authority and was implemented in December 2014. I am also conscious that the outcome, although not ideal, was preferable to the alternatives, including the wind up of the Scheme.