ESB strike looms over deficit in pensions

Strike action could occur at the ESB within weeks over the company’s failure to address a €1.6bn deficit in its defined benefit pension fund or contribute to the levy on the scheme.

Brendan Ogle, secretary of the ESB group of unions, said the likelihood of action had escalated significantly this week following the company’s confirmation to trustees of its plans not to pay towards the €18m cost of the Government’s pension levy.

Mr Ogle said the trustees had informed the company’s pension forum of the decision earlier this week.

He said workers will receive letters from the trustees in the next few weeks, advising that their pension entitlements will be cut.

Earlier this week, before the company’s communication with trustees, Mr Ogle had written to the ESB saying it would be “unconscionable” if management did not make its contribution.

In the letter to Pat Naughton, ESB’s director of Group People and Sustainability, the union official accused ESB of having “completely mismanaged pension matters affecting this scheme and its members”.

“ESB has failed to close the €1.6bn MFS deficit and has engaged in selling assets and intends to pay extraordinary dividends to the owner,” he wrote.

“None of this has addressed any of the pension concerns raised with ESB repeatedly, and formally, by the Group of Unions over a very protracted period.”

Mr Ogle said the company was aware that without funding to address the levy, the trustees would be left with no option but to apply even further cuts to the pensions provisions of active, retired, and deferred scheme members.

He said, in addition, that members of the separate defined contribution scheme will also suffer further cuts to their pension savings.

A special delegate conference of the Group of Unions has been scheduled for Saturday, Sep 21, in Liberty Hall in Dublin and will include a motion for industrial action, up to and including strikes.

Mr Ogle said the company’s failure to address the €1.6bn deficit in the pension scheme, compounded by the failure to contribute to the levy, would make it highly likely that delegates would rubber stamp a ballot for strike action.

He said the members of the unions, who make up a significant proportion of the ESB workforce, would most likely ballot in favour.

“There is already great concern among the members about the company’s attitude,” he said.

A spokeswoman for the ESB said it had received the letter from the group of unions and would consider it before making a response.

She would not say whether the company was prepared to make a contribution towards the cost of the pension levy.