Bank of Ireland workers offered new pension scheme - Unions at Bank of Ireland will this morning recommend that their members accept a new pension scheme arranged with Bank of Ireland. This will resolve a row started in May 2006, when during partnership talks - and days before announcing pre-tax profits of €1.3 billion - the bank announced plans to scrap its defined benefit scheme for new entrants from October last year. The scheme led to industrial action last November, and for the last eight months talks have been taking place between the bank and its unions. The resolution is the new 'life balance scheme', which will see staff pay mandatory contributions of 2.5% cent of their salary to a Defined Benefit Retirement Capital Account. Staff can also contribute to a Personal Investment Account with the bank matching contributions up to 3%.
Pensions Ombudsman Paul Kenny says that this is an interesting scheme which would be attractive to the members of the Bank of Ireland pensions scheme and that he is glad to see it being recommended by unions.
He says that new entrants, who were at the core of the row last year, would be given the option to stay in the current Defined Benefit Scheme, or move into the new scheme, which will be mandatory for people taken on after it is introduced. He says these people have an important choice to make, and they should consider it carefully, making a choice suitable to their own circumstances.
The Pensions Ombudsman says the scheme gives the possibility of really good benefits, and one of the significant issues is that there is no integration with the State benefit, which is not taken into account in the calculation of how the scheme is funded.
In addition, he says that the bank gets peace of mind as it gets the members to share some of the risks associated with Defined Benefit Schemes as long as the current accounting schemes stay in place. Defined Benefit Schemes, he says, have introduced a lot of volatility into the balance sheet.
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Commission wants to close down black market - The first ever Europe-wide survey on undeclared work shows there is a large market for undeclared or cash work all over the European Union, with the highest incidence in the construction sector and in domestic services. New trends on the undeclared or black market include sub-contracting and false self-employment. The survey shows that only 2% of Irish people admit to getting all or part of their income cash-in-hand and only 37% of Irish people believe that there is a high risk of the authorities finding out about undeclared work. To tackle the problem the European Commission is to introduce some proposals.
The European Commission's representative in Ireland, Martin Terret, says the problem is costing Germany 4.5% of its GPD with a similar amount in Denmark. He adds that while figures are not generally available for Ireland, that is one area in which the Commission is working on. He says that despite the strong economic climate at the moment, the practice is still being carried on because exploitation is very much at the root of making profits in some sectors.
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News in brief - Revenues at Elan, for the three months to the end of September increased by 43%, driven by the uptake of its MS treatment Tysabri. This generated sales of nearly $100m in the three month period, and 17,000 people now use Tysabri.
*** The world's biggest passenger plane, the Airbus A 380 or super jumbo, is flying its first commercial flight from Singapore to Sydney today. Its wingspan is the width of a soccer pitch, so lots of widening and reinforcement work needed to be done at Sydney Airport to accommodate the plane. Passenger Julian Hayward paid more than $100,000 in a charity auction to fly in seat 1A.
*** Microsoft has paid $240m for a 1.6% stake in social networking site Facebook, that values the firm at $15 billion. Facebook had turned down an offer from Google, which was also keen to invest the site. Facebook was founded by Harvard student Mark Zuckerberg four years ago. Now aged 23, he says he would like to hold off on an initial public offering for at least two more years. Last year he turned down a $1 billion takeover offer from Yahoo.
*** The success of the Wii has helped Nintendo treble its profits in the six months to the end of September. Demand for the console has outstripped that for Sony's Playstation3 and Microsoft's XBox 360 - selling about 7.3 million units. The Japanese firm made an operating profit of $1.65 billion in the period.
