Adding a few shillings to the bank pension
Brian Cowen to Enda Kenny today –
[Irish Times] “Contrary to how this is being portrayed, this is a payment into an overall fund that provides for the pensions of most Bank of Ireland staff. If it wasn’t made, the fund would be short-resourced to meet its obligations to all Bank of Ireland pensioners and staff who retire in the future,” the Taoiseach said. “It’s a payment which was being paid to the bank staff pension fund in order to sustain agreed pension of the chief executive [Richie Boucher], a pension which is based on his salary and which is now controlled by Government under the Covered Institutions Remunerations Oversight Committee. “The payment is into the pension fund, because unlike public service pensions, obviously it must be pre-funded.”
Note: The National Pensions Reserve Fund was founded to pre-fund public service pensions after 2025. But now it’s in a worse position to do that, because it was raided for the preference share funding for Bank of Ireland and AIB, capital which allowed those banks to stay in business and continue to fund their pensions.
By contrast, Waterford Crystal, which received no NPRF infusion, will leave its workers with about one-third of their promised pensions — which is a lot less than EU Directives were supposed to mean for insolvent companies.