Business Pensions

Monday 24 October 2016

Burton has no mandate to sign off on new pension levy - union

Published 22/04/2016 | 02:30

Acting Tánaiste Joan Burton. Photo: Frank McGrath
Acting Tánaiste Joan Burton. Photo: Frank McGrath

Acting Social Protection Minister Joan Burton has been called upon to immediately revoke new regulations levying a charge on fund values for deferred pension members.

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The union Mandate said the move, which affects 400,000 workers, sets a worrying precedent.

The workers, who have yet to retire, are likely to have smaller pensions after the outgoing Labour minister signed the order telling trustees to reduce the value of their pension funds.

It is the first time a statutory order has been used to effectively reduce the value of these funds.

The move reflects the fact that inflation is negative. It only affects those who left a defined benefit scheme and have yet to retire. The order is retrospective to 2015.

The order signed by the minister will hit 414,000 deferred pension scheme members.

These are people who were in a defined benefit pension but left the scheme to get another job, were in a scheme that has been closed down, or took redundancy but have yet to retire.

Unite regional co-ordinating officer Richie Browne said: "Statutory Instrument 52/2016, issued by acting minister Joan Burton earlier this month, has not only cut the future pensions of over 400,000 workers - it also sets a worrying precedent and further increases uncertainty for workers."

He claimed that neither the caretaker Government nor the minister have a mandate to make a decision with such far-reaching implications.

Mr Browne said the decision would affect the future pensions of hundreds of thousands of workers, and Unite called on the minister to immediately revoke the regulations pending a full consultation with all stakeholders.

Irish Independent

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