ESB workers face cuts after deal to plug deficit is agreed
WORKERS in semi-state electricity company ESB face a sharp cut in their pensions after a deal was hammered out between unions and management in a bid to plug a €1.9bn deficit.
Workers in the ESB, who are among the highest paid in the State, are to be consulted on the changes this week.
Up to now the workers enjoyed a defined benefit pension where workers with full service get a retirement income of half of their final salary.
But from 2012 on, pension benefits will be accrued on the basis of the average salary earned by the worker in the remainder of their years to retirement.
Workers will retain their defined benefit pension rights for their years worked up to 2012.
The defined benefit scheme will be closed to new entrants who will instead be put into a defined contribution scheme.
It is understood the ESB is making a multi-million euro input into the pension fund, while workers are putting a 2.5pc pay rise into the scheme.
However, the ESB Officers' Association has broken ranks with other unions in the company and its members are refusing to back proposals.
A spokeswoman for the ESB said: "The proposals agreed between ESB management and the unions are currently the subject of comprehensive consultation and there will be no further comment until after that process is complete later this summer.
"The proposals address the pension deficit in an integrated way and ESB believes they will lead to an equitable outcome."
Calls to the ESB group of unions yesterday were not returned.