Possible changes priority order failed Pension schemes

[dewdrop]

While it is appreciated nothing definite has yet been proposed in this area is there any indication as to what level of charge might be applied to existing pensioners in defined benefit schemes to fund such schemes which fail. Basically i am wondering what level of charge might be applied if such a proposal became law.

 

[LDFerguson]

That would ultimately depend on how badly in deficit the scheme itself was. So in theory, if the scheme was only 70% funded, pensioners could face a 30% haircut on their pensions.

That said, there is talk that there could be a "guaranteed minimum pension" that would be protected. So if the minimum amount was, say, €12,000, that level would be protected and any pension over and above that could be subject to a haircut.

But as you say, all of this is just speculation as nothing has been announced.

 

[JoeRoberts]

If memory serves correctly, the proposal in 2011 (that was not implemented) was that pensions in payment would get priority up to 75% of the pension amount, subject to a maximum of 30,000.
But this has all been set aside today for the moment.