Threat of ESB power cuts averted as deal struck

The threat of power cuts over Christmas was lifted last night after the pensions row between unions and management at the ESB ended in what unions called “a landmark victory”.

An all-out electricity strike had been threatened as of 8am next Monday, with the disputes committee of the ESB Group of Unions claiming last Friday that power cuts were likely.

But just after 5pm yesterday, it emerged that the dispute was over, with crunch weekend talks facilitated by the LRC finalising a deal.

Under the agreement, the pension fund for workers will be treated as a defined benefit scheme — meaning in the event of a deficit, management and workers will engage to resolve it.

That would have changed under management plans and last night the ESB Group of Unions and its general secretary, Brendan Ogle, claimed the resolution to the dispute was “a landmark victory” for workers.

In a statement the union said: “The resolution is on the basis of the union mandate to protect the ESB pension scheme as a defined benefit pension scheme and to maintain existing agreements being fully met.

“The ESB workers have been publicly vilified for nothing more than protecting themselves and their families against an attempted destruction of their bought and paid-for pension rights.”

Mr Ogle said: “We have now gone back to what we have always had”, adding the agreement fully vindicated the workers’ position.

Communications Minister Pat Rabbitte welcomed the agreement saying: “The settlement is unqualified good news at this critical juncture of the year and of the country’s economic recovery.

“Unions and management deserve credit for ending the uncertainty that threatened to do disproportionate damage to the country’s best interests.”

The ESB said in a statement: “The resolution of this issue protects the financial strength of ESB — there will be no additional liabilities on ESB’s balance sheet.

“The agreement recognises ESB’s existing obligations under the terms of the scheme and there will be no change to the accounting treatment of the scheme in the company’s financial statements as a result.”

However, Mr Ogle said that at least €369m would have to be added to the balance sheet as a result of yesterday’s agreement.

The ESB pension fund saw an 18% rise on its investments last year. The Sunday Business Post reported yesterday that the pension’s deficit was more likely €78m and not €1.7bn, as feared by union members.