Ireland’s Department of Social Protection (DSP) has stressed the responsibility of employers and trustees to ensure defined benefit (DB) funds are sustainable, thereby sidestepping questions about the need for reform of the regulatory framework in the wake of a recent High Court ruling.
Asked by IPE if the minimum funding standard (MFS) was in need of review, despite only being amended in 2012, a department spokeswoman declined to answer directly.
Instead, she said the existence of the MFS should not be seen as the “central issue in relation to whether a scheme is properly funded”.
“Rather, the responsibility rests with the employer and the trustees for ensuring the scheme is properly funded and managed,” she said.
The comments come after the country’s High Court recently found in favour of the trustees of the Omega Pharma DB plan, which requested a €2.2m sponsor payment prior to wind-up despite being fully funded under the MFS.
However, the DSP spokeswoman said both administrative and legislative changes in recent years had been implemented to allow sponsors and trustees to “address the funding difficulties facing many schemes”.
“The Pensions Authority is working with the trustees of defined benefit pension schemes, particularly schemes in a weak funding position, to help them achieve a sustainable funding position,” she added.
The spokeswoman also did not say whether the DSP would ask the Pensions Council, soon to be in charge of regulatory matters following changes to the regulatory architecture, to review the MFS.
She said the up to 12-strong Council would be in place “in the near future”, and that applications for its membership were currently being considered.
The DSP previously told IPE that 56 applications to fill the remaining 4-8 seats on the Council had been received.
The remaining members will be drawn from the DSP, the Department of Public Expenditure and Reform and the Central Bank of Ireland.
Minister for Social Protection Joan Burton earlier this year put forward Jim Murray, former director of the European Consumers Organisation, as her nominee to chair the Council.
His appointment has yet to be formalised.