Aviation authority seeking changes to pensions

The Irish Aviation Authority (IAA) is seeking to introduce member contributions to its defined benefit pension scheme for the first time in a bid to tackle its €62 million deficit.  Ciarán Hancockreports.

At present, the IAA pays a generous 30 per cent pension contribution for staff members.

IAA chief executive Eamonn Brennan said it now wanted employees to make a contribution of 5-8 per cent to the scheme with the authority reducing its contribution by same amount.

The IAA, which manages Irish air space and regulates airlines based here, also wants to introduce a separate defined benefit scheme for new staff.

The size of the IAA's contribution to the pension scheme is a hangover from the days before the authority became a commercial semi-State company in 1994 and staff were members of the Civil Service pension fund, which was paid for by the Exchequer.

Mr Brennan said talks with the Impact trade union have taken place and the matter was being referred to the Labour Relations Commission (LRC) as part of the Towards 2016 national pay deal.

Mr Brennan said he hoped a deal could be concluded in September or October. The IAA employs 670 staff.

A dispute over productivity relating to the introduction of new technology was also ongoing and has been referred to the LRC/Labour Court.

Details of the pension deficit and the disputes with staff were contained in the IAA's annual report, which was published yesterday. It showed that the IAA's after-tax profit rose by 2.3 per cent to €13.7 million in 2006, while turnover increased by 5.2 per cent to €134.4 million. "It's been a good year for us," Mr Brennan said.

There were 251,235 aircraft movements through Dublin, Shannon and Cork airports last year. This represented a 4 per cent increase on 2005.

In addition, 391,273 aircraft used Irish-controlled air space when travelling from other parts of Europe to North America. About 90 per cent of aircraft travelling between the two continents use Irish air space.

Mr Brennan said the weak dollar and increased competition meant that transatlantic air traffic was increasing by about 5 per cent a year.

The open skies agreement, which will lift restrictions on the transatlantic routes that can be flown by airlines, would probably increase traffic through Irish air space by an additional 20 per cent over the next five years.

"It will definitely encourage more travel between the United States and Europe and we're in a good position to take advantage of that," Mr Brennan said.

The IAA is planning a €220 million capital expenditure programme over the next nine years.

This will include an €8 million control tower at Cork airport and a €40 million-plus tower at Dublin if a second runway is built. It will also provide for new radar and air traffic management systems. The spending will be funded from its own resources - it had €41 million in cash at the end of 2006 - and borrowings.