Dáil Éireann Debate, Tuesday - 17 January 2017
537. Deputy David Cullinane asked the Minister for Social Protection the process by which the Pensions Authority considers whether to make a direction to the trustees of a pension scheme to wind up a scheme. [41042/16]
Amharc ar fhreagraSections 50 and 50B of the Pensions Act, respectively, give the Authority the powers to direct trustees of defined benefit (DB) schemes to reduce benefits under a scheme or to wind up the scheme. These powers may be exercised by the Authority where a DB scheme fails to meet the statutory funding standard under the Act.
The Authority recognises the serious nature of these powers and the impact their exercise may have on members’ benefits, and, as a result, only takes such a serious step reluctantly. However, the Authority must ensure that the funding standard is adhered to and cannot permit persistent non-compliance in this area because an underfunded scheme is unlikely to be able to pay the benefits promised to scheme members without a sustainable recovery plan being put in place. In such a situation, younger members are at particular risk not only of getting less than full benefits but of losing the contributions they may be making into the scheme.
Regulations issued under Section 50 and Section 50B of the Pensions Act set out the information and notification requirements that must be carried out by scheme trustees before the Pensions Authority issues a direction under Section 50 or Section 50B of the Pensions Act.
Where the Authority proposes to issue a direction under Section 50 or 50B of the Act, all members (actives, deferred and pensioners) will be afforded the opportunity to make submissions to the Authority. Scheme members who have concerns about the funding status of their scheme should in the first instance contact the trustees of their scheme.
The Authority strongly encourages trustees of such schemes to accelerate their own efforts to find a solution to their funding deficit without Authority intervention.
I hope this clarifies the matter for the Deputy.
