Saturday 22 November 2014

ESB unions call for cap on pension benefits

Charlie Weston Personal Finance Editor

Published 11/10/2012 | 05:00

POWERFUL unions at the ESB have added their voices to those calling for a cap on the amount of pension money high earners can get out of a fund when it is being wound up.

Around eight out of 10 defined benefit pension schemes are so badly in deficit that they are likely to close.

When a scheme is shut, priority over all the funds is given to the pensioners. The rest of the funds are then distributed to the members who have yet to retire.

The Government is now reviewing the so-called priority order when a pension is being wound up.

Unions at the ESB have called for a change that would see a fairer distribution of the assets of bust pension schemes.

They want new rules brought in that would see a minimum provision for all members of a closing schemes equal to the state pension amount.

This figure of just less than €12,000 would be given to each member before other funds are distributed.

And it wants pensions to then be based on a salary of no more than €80,000. This would limit the pensions of high earners.

Irish Independent

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