Irish taxpayer €1bn bail-out of FÁS & university pensions

[BoyRacer]

Irish taxpayer to provide €1bn bail-out of FÁS and university pension funds - Michael Hennigan → finfacts.ie/irishfinancenews … 0763.shtml

As the Government scratches around to find more than €4bn to reduce the deficit in its forthcoming budget, it has been revealed that the Irish taxpayer is stuck with a €1bn bill to bail-out the pension funds of State agencies like FÁS and and public bodies such as the universities.

Responsibility for semi-State and university pensions was assumed directly under the Financial Measures (Misc. Provisions) Bill which was rushed through the Dáil in just three days in 2009. The National Pensions Reserve Fund is now responsible for these funds and in a response to a Dáil question, the Minister for Finance, Brian Lenihan, has signalled in a letter to Fine Gael’s Denis Naughten TD, that the deficit may exceed €1bn.

The university deficits amount to about €630m led by Trinity College at €315m.
**
While the majority of Irish private sector workers have no occupational pensions and those who do face the prospect of meagre payouts, it has been an exception in universities for both academic and non-academic staff to retire without additional pensions years allocated. **

**It’s interesting to observe the silence of normally voluble academic commentators on public spending issues, about the gravy train under their noses.
**
there is more

[Maor_Uisce]

Another scandal. It is shameless.

[conor_mc]

Why was this legislation rushed through in 2009? Was it just to give Lenny another pot of gold to piss away on the banks, as if the NPRF wasn’t enough?

[yoganmahew]

@conor_mc

Why was this legislation rushed through in 2009? Was it just to give Lenny another pot of gold to piss away on the banks, as if the NPRF wasn’t enough?

Yep. Too many chums stood to lose out by having to fill the shortfall in their pensions themselves.

[sorehead]

Was there talk here or elsewhere that the move was partly inspired by the need to hide the fund deficits, i.e. the Irish government does not include pension liabilities to public servants in the national debt, but these organisations wouldn’t have the same lattitude to do so as they’re semi-state.

The suggestion was a possibiltity of pension legislation forcing state borrowings to fill the deficits.

(Some newer EU countries are a little cheesed off they had to include public pensions in calculating their debt while the existing countries are holding off on doing it.)
blogs.wsj.com/new-europe/2010/08 … y-on-debt/

[FB2]

At the time the Government wanted to get their hands on the cash in the Universities pension fund to fund some of the short fall in “liquidity”. I’m sure once we are out of this silly little misunderstanding with the world financial markets everything will be fine.

I would be interested to see how the 1Bn shortfall is calculated. With the coming drops in public service numbers by cuts or if the CP agreement stands, then surely the amount of people qualifying for this full pension will be seriously reduced.

[polaris]

And the retirement age will be raised from 65 to 68 in stages over the next ~20 years so these “added years” are going to be less of a factor for anyone currently under 45.

Sweet deal for anyone retiring now, mind you.

[GruttePier]

@FB2

At the time the Government wanted to get their hands on the cash in the Universities pension fund to fund some of the short fall in “liquidity”. I’m sure once we are out of this silly little misunderstanding with the world financial markets everything will be fine.

I would be interested to see how the 1Bn shortfall is calculated. With the coming drops in public service numbers by cuts or if the CP agreement stands, then surely the amount of people qualifying for this full pension will be seriously reduced.

You think that if public service numbers are cut, they will exit without a full (or very favorable) pension? Look at the mindset of decisionmakers in the PS (or state bodies) at the moment. From same finfacts source:

‘In a separate report, the C&AG said additional years have become a feature of pension awards in universities. By way of example, in UCD 78% of staff retiring between October 2007 and September 2008 had **years added **to their service for pension purposes. These 42 employees had an average of 4.2 years added to their pensionable service and their average salary on retirement was €74,434.’

‘Another couple of years anyone?’ ‘Uh, what about the ethics in all of this? I mean, the taxpayer pays for it in the end’ ‘Ah sure, you are grand, we all get it’

But I guess, just accept it all, like a senior poster mentioned here to me (and the unions tell all of us), it is not about the public versus the private sector… We are all in this mess togehter. I guess some a little more than others though…