Concerns over defined benefit pensions

The Pensions Board annual report highlighted concerns about the ability of defined pension schemes to meet their funding obligations.

The warning came just days after Independent News and Media (INM) announced that it would have to cut the payments from its defined benefit pension scheme by 46% as the scheme is insolvent.

The INM announcement is just the latest in a long line of defined benefit schemes which have become insolvent with estimates as high as 80% of the schemes maybe under water. High-profile schemes with large deficits include AIB with an €800m funding hole and Bank of Ireland with a €1.2bn. Aviva and Permanent TSB are winding down their defined benefit schemes.