ESB Defined Benefit Pension Scheme
Traditionally, all staff recruited into ESB joined the Defined Benefit (DB) Pension Scheme and staff employed by ESB subsidiary companies joined the ESB Subsidiary Companies Pension Scheme which is a Defined Contribution (DC) scheme. Since 2010 the DB scheme is closed to new members and all staff joining ESB and its subsidiary companies join the DC scheme.
The ESB Defined Benefit pension fund lost 40% of its value or € 1.5 Bn in 2008, coincident with the arrival of global economic turmoil and vast deterioration in the share prices of many former "gilt-edged" companies. Actuarial valuation of the fund projected a deficit of € 1.96Bn (i.e. the shortfall in the fund's ability to meet all of its liabilities in terms of paying pensions to current and future pensioners) making it a very serious issue for ESPA and its members.
In 2009, ESB and the Group of Unions entered negotiations with a view to addressing the major shortfall in the fund. Following prolonged talks and consultations both sides agreed in 2010 to convert the scheme from a final salary type to a Career Averaged Revalued Earnings (CARE) system with the effective date of 1st January 2012. The principles of CARE and other changes to the scheme are outlined in the Pension Agreement 2010 (to be found in the Members' section).
During 2011 ESPA member, Jim Dullaghan, was elected a trustee of the Pension Fund.
The 2010 Annual Report of the ESB Pension Scheme can be viewed in the Members' section.