Airline pension plan to have ‘drastic impact’

Proposals designed to end a dispute over a €780 million deficit in the Aer Lingus/Dublin Airport Authority retirement scheme are grossly unfair to some members and could cost them up to 50 per cent of their pensions, they claim.

The trustees of the companies' Irish Airlines Superannuation Scheme (IASS) last week circulated a new plan for tackling a dispute over the retirement scheme's shortfall, including cutting pension payments to retired staff and reducing by 20 per cent the benefits built up by workers.

Deferred members – those who have left the companies but have yet to retire – claimed yesterday that the “proposed cuts and measures will have a drastic impact on deferred members and will result in a loss of up to 50 per cent of their expected pension”.

The Deferred Pension Group, which represents them, produced figures showing those expecting to get a pension of €37,590 a year may only get €19,399.

The group argues that deferred members' interests have been sidelined because they are not represented by any trade union. Siptu members in Aer Lingus and at Dublin, Shannon and Cork airports last week voted overwhelmingly in favour of industrial action, before the trustees published the proposal.

“Deferred members have no access to the industrial relations mechanisms of the State and, as such, are completely reliant on the trustees to achieve a proportionate result for all members,” the group’s statement said.

Part of the final settlement involves moving members into a new defined-contribution plan, for which employers will no longer be liable.

The employers support this plan and are prepared to make once-off, lump-sum payments into the new plan.