Monday 19 February 2018

High-flying scheme's soaring shortfall began as recession hit

THE Irish Airlines Superannuation Scheme has over 14,000 members, two thirds of whom are current or retired Aer Lingus staff.

The rest are employees of the Dublin Airport Authority and the ill-fated SR Technics, which closed three years ago.

Like many other pension schemes, it went into the red during the recession.

The deficit mounted rapidly to €302m in March 2010, before rising to €343m a year later.

It has continued to escalate and the shortfall widened by €300m last year.

Aer Lingus chief executive Christoph Mueller has described the €700m shortfall as "frightening" but has insisted the airline will not be topping it up.

The airline argues that it's not obliged to contribute anything beyond the fixed-rate contribution of 6pc.

Unions claim that it is a defined benefit scheme, which means it has guaranteed benefits, meaning it is up to the employers to "make good" any shortfall.

Ryanair, which owns almost 30pc of Aer Lingus, previously threatened legal action if the airline injected fresh funds into the scheme.

However, chief executive Michael O'Leary more recently indicated it might put some money in if staff agreed to "productivity gains".

Irish Independent

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