Taxpayers to plug €267m Fás pension deficit

FÁS has a massive €267 million hole in its pension fund which will now have to be paid for by the taxpayer under rules introduced last year to guarantee semi-state pension pots.

Fine Gael, which is discussing plans to close down the agency if it’s in Government, said this was an example of “another bailout” that the taxpayer could do without.

The party has indicated it will abolish 150 quangos, including Fás and the HSE, in plans that will be unveiled in a policy paper later this month.

The troubled state training agency has assets of €384.5m and liabilities of €632m in its pension fund, according to figures from the Department of Finance, leaving the taxpayer exposed to the €267.5m gap.

Under the Financial Measures (Misc Provisions) Bill rushed through the Dáil in just three days last year, these pensions are guaranteed by the taxpayer.

Fine Gael described it as “another substantial bailout for the taxpayer” and said the Government should make some of the organisations recoup the money themselves.

“It is very hard for the public to accept why we should have to guarantee the pensions for organisations like Fás where over the past three years we have heard unbelievable stories of excess by senior management at the expense of the taxpayer,” said the party’s deputy health spokesman, Denis Naughten.

“We are now in a situation where many people are struggling to make pension contributions, paying a pension levy, or watching their pensions being reduced. So why should the taxpayer, without adequate information, be blindly guaranteeing defined pensions for senior management in these organisations?” asked the Roscommon TD.

“A culture of luxury and excess distracted senior Fás management from what should have been their primary goal: training the unemployed and getting people back to work,” he said, adding that the Government was now “rewarding their failure”.

Separate figures released to Deputy Naughten show the extent of problems facing universities, with pension deficits reaching almost €790m in five colleges, even though some staff were allowed to retire on enhanced pensions.

The pension fund of UCC has liabilities of €143.9m, UCD’s fund has deficits of €101.5m while NUI Galway’s pension pot has a €132.3m hole.

Mr Naughten said: “We don’t know what the implication of the final cost on the Government fiscal policy will be and we have yet to see if the Government intends to make any attempt to recoup some of these costs from the organisations themselves.”