The Social Welfare and Pensions Act 2009 was signed into law on 29 April 2009. All provisions of the Act are effective from that date.
The Minister for Social and Family Affairs introduced a number of substantial amendments to this legislation at Committee stage earlier this week to provide support for members of defined benefit pension schemes.
The measures now included in the Act include a new Pensions Insolvency Payment Scheme (PIPS) to assist employees and former employees of companies where the employer becomes insolvent and the defined benefit pension fund is in deficit. Under the scheme, the scheme trustees can pay a sum to the Exchequer to recover the cost of paying the pensions of retired members instead of buying annuities.
The Act changes the way that funds are disbursed if a defined benefit pension scheme is wound up with a deficit. Pensioners will continue to get first priority for their pensions but any future pension increases will not be granted until workers who have also contributed to the scheme and have yet to retire receive their share of the benefits. The Act also provides for restructuring of defined benefit pension schemes and provides for greater regulation of employers including prosecution of those who do not pass on the pension contributions made by employees to a pension scheme.