Business Irish

Saturday 3 December 2016

AIB staff accept pension plan

Joe Brennan

Published 04/03/2010 | 05:00

WORKERS at Allied Irish Banks have voted to accept the group's plan for members of its defined pension plan to start contributing 4pc of their salaries to the scheme from next month.

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Beneficiaries of the scheme will see their contributions rise to 5pc next year. Staff who joined the bank before 1998 are part of the plan and have not had to pay into it until now.

The new terms are in line with recommendations from independent mediator Kevin Foley, of the Labour Relations Commission, who was brought in late last year to block an impasse between the IBOA finance union and AIB over how to tackle the pension deficit.

Benefits

Staff who still do not wish to contribute will see their pensions fall from two-thirds of final salary to a lower level.

IBOA general secretary Larry Broderick said: "Our members in AIB have recognised the serious difficulties facing the pension scheme and have risen to the challenge by accepting a reduction in benefits together with, in some cases, an increase in contributions."

He added: "This has been a very tough call in the present circumstances. But our members have bitten the bullet. It is up to the bank to reciprocate."

AIB said on Tuesday that its pension deficit had almost halved in the final six months of the year to €714m.

Still, banks are wary of recent proposals from the influential Basel Committee on Banking Supervision that pension deficits should be deducted from lenders' all-important equity capital.

Irish Independent

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