THOUSANDS of ESB employees have an average shortfall of 285,693 each in their pension pots at the end of last year.
The total deficit to the defined benefit pension scheme is almost 2 billion as a result of the collapse in investment markets last year,
according to a report prepared by an actuary who undertook a valuation of the ESB pension scheme.
The unions said that everyone at ESB was aware of issues with the scheme and the actuary’s findings were presented to meetings of the board, the trustees, unions and the superannuation committee yesterday.
The fall in value was in line with that of other Irish pension funds in 2008, the ESB said in a statement yesterday.
The fund’s value is around 2.4bn and ESB’s pensioners will not see a reduction in their current pension payments as a result of the deficit.
There are 6,850 staff contributing to the fund and the ESB said
it has advised staff of the outcome of the valuation and members will receive further information in the next few days.
“The scale of the deficit presented does not come as a surprise
given the current world recession and the 38% fall in equity markets in 2008, but it does require remedial action to address the deficit,” ESB said in the statement.
Management at the ESB said it is they are “fully committed” to working with the group of unions to develop a resolution to the issue.
“As is required under the regulations governing the scheme, ESB will also be consulting the Trustees and Superannuation Committee.” they said.
The ESB pension scheme is funded by company and staff contributions and is independently managed.
ESB said the deficit will not prevent it pursuing its investment strategy.
Davy Naughton, secretary of
the group of unions at ESB, said: “As has happened on all previous occasions where a similar issue arose, the group of unions in
consultation with ESB and the fund trustees will engage as to the potential consequences of the deficit, with the purpose of finding the most appropriate manner to address same in the interests of all members.”
© Irish Examiner Ltd. All rights reserved