Staff working for the CIÉ group of transport companies have voted to accept proposals recommended by the Labour Court to deal with a major deficit in its pension scheme that covers managerial and administrative grades.
The proposals were accepted by 56 per cent to 44 per cent in a ballot of trade unions members . The result of the ballot was announced on Wednesday.
The so-called 1951 scheme in the transport group is understood to have a deficit of about €550 million.
The Irish Times reported last week that the Pensions Authority had warned it could wind up the scheme or reduce benefits, unless steps are taken within the next few weeks to address a financial deficit.
The 1951 scheme at CIÉ is a defined-benefit arrangement and, based on 40 years’ service, the pension payment involves 50 per cent final salary and a lump sum of 1½ years’ pay. Members can retire at 60, although they can continue to accrue service up to age 66. The actual average age of retirement is 63.5 years.
At present the employer contributes about 28 per cent and the employee about 8 per cent.
Under the Labour Court proposals, the new minimum age of retirement for those under age 60 at present would be 63 years.
Those wishing to retire prior to 63 could do so, however, by paying a contribution from their lump sum. Their pension in such circumstances would not be discounted.
The scheme would remain open to new entrants but pensions would be based on career average earnings.
The CIÉ group would contribute a minimum of €320 million over the 10-year funding proposal.
CIÉ said it welcomed the result of the ballot.
“The company confirms its hope that the 1951 Pension Scheme Committee, who are responsible for submitting a compliant Funding Proposal to the Pensions Authority to address the minimum funding standard deficit, do so as a matter of urgency, to avoid Pension Authority intervention. “