Aer Lingus CEO pension letter 'most unhelpful' - SIPTUFriday 13 June 2014 22.35
SIPTU has described a letter from Aer Lingus Chief Executive Christoph Mueller urging an expert panel investigating the aviation pension row to delay its report as "most unhelpful".
The Irish Airlines Superannuation Scheme covers 15,000 current and former employees in Aer Lingus, the Dublin Airport Authority, the Shannon Airport Authority and the now defunct SR Technics.
It has been estimated that if the IASS was wound up now, members could lose up to 90% of their anticipated pension benefits.
The airline has already committed to contributing €110m to plug the deficit for current employees, and another €30m to provide for former employees who have not yet retired (deferred members).
Earlier today, RTÉ News revealed that Mr Mueller told the panel the Aer Lingus Board was concerned about draft proposals for addressing the deficit.
He said without significant cost-offsetting measures from staff, it would be extremely difficult to get shareholders to approve lump sums currently estimated at €140m to plug part of the Aer Lingus portion of the deficit.
SIPTU Pension Policy Advisor Dermot O'Loughlin told RTÉ's Drivetime programme members were shocked that the chief executive had intervened in this way.
He said staff had thought they would be at the end of a process of seeking a resolution to the row over the €780m deficit in the scheme when the expert panel issued its report this Monday.
However, he said Aer Lingus appeared to know more than the unions about what the panel was considering.
He said it is unbelievable that certain questions posed by Mr Mueller had not been clarified until now.
He also said it beggared belief that the Board had only now set up a sub-committee to deal with the pension issue.
He rejected Mr Mueller's suggestion in the letter that €93m would suffice to meet target pension benefits set out in a previous Labour Court recommendation, saying those calculations were based on flawed assumptions.
Mr O'Loughlin stressed the urgency of the situation.
He said since the expert panel had been set up in March, members had put in another €6m, but those contributions would deliver virtually no benefit.
He said it would damage the credibility of the expert panel process if it failed to report on Monday as planned.
Sources said the panel is still planning to meet on Monday, but that they had no information about whether the report would be published then.
The expert panel was appointed in March by the Minister for Transport Leo Varadkar, after the Labour Relations Commission and the Labour Court failed to secure agreement on how the deficit should be addressed.
Its members are former IMPACT general secretary Peter McLoone, former IBEC director of Industrial Relations Brendan McGinty, accountant Eugene McMahon of Mazars and Laura Gallagher of KPMG.