UTV staff told pension fund has slipped into deficit

Staff at Ulster Television (UTV), the company which paid €14 million for Lite FM last month, have been told that their pension fund has slipped into deficit by £700,000 sterling (€1,060,606).

The fund, which was in a position to fund almost 150 per cent of its liabilities three years ago, is now equal to about 97 per cent of its obligations.

The news comes as UTV completes a three-year contribution "holiday" in respect of the fund, a break which is understood to have saved the company about £3.6 million.

Over the same period, it has spent almost €70 million on three major radio acquisitions in the Republic.

It is believed that a number of UTV staff are asking why the pension fund has been allowed to fall back at a time when the company has been engaged in such active expansion.

UTV does not engage in negotiations with union representatives among its staff, but it is understood that two unions - the National Union of Journalists (NUJ) and the Broadcasting Entertainment Cinematograph and Theatre Union (BECTU) - will be holding soundings on the issue over coming days.

Staff were informed of the deficit at a series of meetings last week at which employee benefits consultants, Mercer, explained that the fund had suffered an investment loss of about £16 million since UTV had ceased contributing.

Most of the decline was attributed to a general downturn in global stock markets, with members informed that more than 80 per cent of their fund's assets was held in equities.

It is believed that staff have been asked to consider a number of options that might stem the fall in the fund's value. These include raising contributions, delaying retirement and reducing the accrual rate on their pensions.

Currently, most of the scheme's members are guaranteed one fiftieth of their final salary for each year worked. It is thought that senior executives, whose accrual rate is one thirtieth of their final pensionable salary, are unlikely to see changes to current arrangements.

The pension fund, which currently comprises 150 active members, 120 pensioners and 145 deferred pensioners, was recently closed to new members.

UTV is expected to recommence contributions to the fund this year.

A UTV spokeswoman declined to comment on the state of the pension fund yesterday, saying: "It is UTV policy never to comment on staff or remuneration issues."

NUJ Irish secretary Mr Seamus Dooley has expressed concern at the situation within UTV.

"We're genuinely concerned at rumours surrounding UTV's pension fund and will be seeking clarification on behalf of our members," he said.

Mr Dooley believes lack of trade union recognition has added to "a climate of fear and uncertainty" at the Belfast-based company.