I reported in October and in November on the lowering of the level of Lough Ree, in advance of heavy rain, to see whether that would help to manage flooding on the Shannon Callows further downstream.
The interim data from the experiment is available on the OPW website here [seven-page PDF]. The conclusion is:
Conclusion
From the water level records, it is apparent that the closing of the gates at Athlone weir in anticipation of a rise in water levels on Lough Ree led to a temporary lowering of the Shannon water levels immediately downstream of Athlone. This possibly delayed inundation of the Shannon callows downstream of Athlone by a number of days. To determine whether the extent or depth of eventual inundation was in any way reduced by the experiment will require more detailed analysis by the CFRAM consultants. Data is available on request from Hydrometric Section if required.
It should be stressed that this is an interim report. This CFRAM background document [PDF] is still useful.
It is not clear to me why the state should spend any money improving the value of privately owned riverside land that is of marginal benefit to the economy.
Posted in Ashore, Drainage, Economic activities, Engineering and construction, Extant waterways, Ireland, Irish waterways general, Natural heritage, Operations, People, Politics, Shannon, Sources, The cattle trade, waterways, Waterways management, Weather
Tagged Athlone, callows, CFRAM, ESB, floods, flow, Ireland, Jacobs, Lough Ree, Office of Public Works, Operations, OPW, Shannon, water level, waterways, Waterways Ireland
One of the problems with all this newfangled technology is that some things — like, for instance, copying a block of text from one document into another – are so easy that folk may forget to check their work afterwards.
Consider, for instance, the Office of Public Works, which seems to have a block of boilerplate text ready for answering written boilerplate questions from midlands TDs who have discovered that things get wet when it rains.
On 22 January 2014 Denis Naughten [Ind, Roscommon/South Leitrim, which — let it be admitted — The Lord intended to be rather boggy and sad] had this question:
To ask the Minister for Public Expenditure and Reform the steps being taken to address flood risks within the Shannon basin; and if he will make a statement on the matter.
The answer tells Mr Naughten about CFRAM — nothing he didn’t know before he asked, I imagine — but it included this sentence:
On foot of discussions between my colleague, Minister of State Hayes and the IFA, and with the cooperation of both the ESB and Waterways Ireland, a water level monitoring exercise is being carried out as part of the CFRAM process which will allow for analysis of water flows and levels at key points around the Lough Ree and Callows areas.
The highlighting is mine: it seemed a bit odd because this written answer was allegedly being given by Mr Hayes.
Mr Naughten had another Q&A here, but it’s not very interesting.
Posted in Ashore, Drainage, Economic activities, Engineering and construction, Extant waterways, Ireland, Irish waterways general, Natural heritage, Operations, People, Politics, Shannon, Sources, The cattle trade, waterways, Waterways management, Weather
Tagged boats, CFRAM, ESB, floods, flow, Ireland, Office of Public Works, OPW, Shannon, water level, waterways, Waterways Ireland, weir
I reported here that, in June 2013,the North South Ministerial Council (in inland waterways format) approved, on the same day, Waterways Ireland’s business plan and budget for 2012 as well as its annual report and draft accounts for that year. In other words, it approved the budget and plan eighteen months after the start of the year to which they applied; it approved the plans for 2012 and, on the same day, approved the outcomes.
Furthermore, by November 2013, 88% of the way through 2013, it had not approved the budget for that year (I don’t know whether it has yet done so). And, as of today (22 January 2014), WI’s annual report for 2012 has not yet been published.
I wrote:
Is it possible that one minister wants to spend very much more or less on waterways than the other does? As the total current expenditure is fixed at 85%/15%, it seems to me that one side might very well come up with a figure that the other didn’t like.
Is it possible that DCAL, run by Mr Adams’s party colleague Carál Ní Chuilín, is more keen on cross-border bodies than is DAHG, run by Fine Gael minister Jimmy Deenihan? Or are both of them struggling to find savings to pay for the Clones Sheugh, or at least as a deposit for the SEUPB?
Or could it simply be that WI is having great difficulty in cutting its expenditure to fit within the limits imposed by the RoI budget?
I then sent enquiries to Waterways Ireland, the (NI) Department of Culture, Arts and Leisure (DCAL), the (RoI) Department of Arts, Heritage and the Gaeltacht and the North South Ministerial Council. From the repsonses, and from yesterday’s statement to the NI Assembly by Carál Ní Chuilín MLA, NI Minister of Culture, Arts and Leisure, it is clear that I was right in my first para; it is possible that the first sentence of the second para is right too.
There is a major disagreement between the northern and southern departments about the level of cuts to be applied to Waterways Ireland’s budget and it is not clear what mechanism can be used to resolve it. DAHG, applying Irish government policy, wants bigger cuts than DCAL does.
After each North South meeting, the secretariat issues a rather bland communiqué; the inland waterways ones are here. I suppose that the secretariat can’t be expected to write “There was a blazing row at yesterday’s meeting, skin and hair flying, and the ministers aren’t speaking to each other”. I mean, they wouldn’t write that even if it were true, which I’m sure it isn’t.
On 9 December 2013 I wrote to NSMC (I omit salutations and irrelevancies here):
Are you able to say anything about why the NSMC Inland Waterways did not approve the 2012 business plan and budget for Waterways Ireland until eighteen months after the start of the year in question? As far as I can see from the minutes for meetings since 2007, that is a highly unusual degree of lateness.
NSMC replied on 11 December (with a copy to the RoI Department of Foreign Affairs):
[…] this is an issue for both Sponsor Departments and they can be contacted directly.
On the same day I asked:
Have you any responsibility for seeing that the terms of the WI Financial Memorandum [PDF] are observed? It seems to me that they have been ignored in this case.
Despite a reminder, I have not yet received a reply.
I wrote to DCAL on 10 December 2013:
I would be grateful if you could help me to understand why the North/South Ministerial Council did not approve the 2012 budget and business plan until 18 months after the start of the year to which it applied.
DCAL responded on 11 December 2013:
Waterways Ireland had submitted a draft 2012 Business Plan detailing the activities required to achieve goals set out in their 2011/2013 Corporate Plan. Recognising the challenges presented by the economic climate there were extended negotiations to agree the 2012 budget. The DCAL Minister raised concerns about going beyond the required savings advised by both Finance Departments. Minister Ní Chuilín therefore sought, and received, assurances from Waterways Ireland that frontline services would be maintained.
I sent follow-up queries on 16 December:
I am not entirely clear on the implications of your third sentence: “The DCAL Minister raised concerns about going beyond the required savings advised by both Finance Departments.”
Do you mean that Waterways Ireland proposed to cut its spending by more than the percentage cuts suggested by the Finance Departments? Or to spend less than it received (or expected to receive), in euro, from the two sponsor departments? If so, why did WI want to do that?
I would also be grateful if you could tell me what WI’s “frontline services” are and why they are deemed to be more important than other services.
And I would be grateful for more information on the reason for the extended delay in approving the busiess plan and budget: eighteen months after the start of the year, which was presumably even longer after the plan was drafted. I would be surprised to find that seeking and receiving assurances took eighteen months.
Did the delay result in a breach of the terms set out in the Financial Memorandum governing WI’s affairs?
I would also be grateful if you could tell me what delayed the approval of WI’s 2013 budget. I note from the NSMC minutes that it was not approved in June 2013; the matter is not mentioned in the minutes of the November 2013 meeting but, on 19 November 2013, the RoI Minister for Public Expenditure and Reform replied to a written question from Gerry Adams TD saying, inter alia, that “The 2013 Budget allocation to the Body are subject to on-going discussion by the two Sponsor Departments.”
That suggests that approval of the 2013 budget is at least eleven months late. I note too that the 2014 business plan and budget, and the Corporate Plan 2014-2016, were not approved at the November NSMC meeting. And I note that An Foras Teanga [Foras na Gaeilge + Tha Boord o Ulstèr-Scotch], the other North-South body sponsored by your department and the Department of Arts, Heritage and the Gaeltacht, was also, in November, awaiting approval of its 2013 budget.
There are two further items on which I would be grateful for information:
(a) is it proposed that the Hutton recommendations be applied to Waterways Ireland (and other bodies in the North-South pension scheme)? If so, what is the expected effect on WI’s budget and on staff take-home pay?
(b) WI’s accounts for 2011 (the latest I have seen) suggest that your department paid less than 15% of the money WI received from its sponsor departments. Did your department pay 15% in 2012 and 2013 and will it do so in 2014? And how do you take account of the effect of currency fluctuations on WI’s income denominated in its working currency, the euro?
Despite a reminder, I have as yet received no reply.
I wrote to DAHG on 26 November 2013 with several questions; I include below only that relevant to this posting.
On 19 November 2013, in a written answer to Gerry Adams, Jimmy Deenihan said […]: “The 2013 and 2014 Budget allocations to the Bodies are subject to ongoing discussion by the two Sponsor Departments and will require, of course, formal approval by the NSMC.”
I would be grateful if you could tell me (a) why Waterways Ireland’s budget had not been finalised when 88% of the year had passed and (b) how that affected budgetary management in the Body.
The department replied on 3 December 2013:
As you are aware, Waterways Ireland is co funded by the Department of Arts, Heritage and the Gaeltacht and the Department of Culture, Arts and Leisure, Northern Ireland. The 2013 Business Plan and budgets have been discussed by Ministers at NSMC Inland waterways meetings and key priorities for 2013 identified. Indicative budgets have been provided by the Departments to Waterways Ireland as a pragmatic measure for business planning and operational purposes and the body is operating within these indicative allocations.
On 9 December I replied:
Thank you. That answers my question (b) pretty well. However, you haven’t answered (a): why Waterways Ireland’s budget had not been finalised when 88% of the year had passed.
I would be grateful for information on the causes of this extraordinary delay.
I have been wondering whether the problems of WI’s budget were very difficult to resolve or whether there was some major disagreement between the northern and southern ministers. If there was such a major disagreement, what was it about?
The department replied on 17 December 2013:
The Departments are still in discussions to agree the budgets. The position is The Department of Culture, Arts and Leisure in Northern Ireland is not prepared to agree a 2013 budget for the Body in excess of a minimum efficiency saving of 3% set out in the two Departments of Finance Funding Framework for the North South Bodies. As you are aware from the Parliamentary Question Reply this Department’s REV provision for Waterways Ireland for 2013 is €25.463m, a 6% efficiency saving on 2012. Given the pressures on the public finances and on the Departments budget allocation, the Department is not in a position to provide any additional funding that would maintain the proportionality of funding. 85% of current funding is provided by Department of Arts, Heritage and the Gaeltacht and 15% by Department of Culture, Arts and Leisure, Northern Ireland.
I responded on 18 December 2013:
[…] Just to make sure I understand you properly: when you say “a 2013 budget for the Body in excess of a minimum efficiency saving of 3%” am I right to presume that the phrase “in excess” applies to the savings or cuts rather than to the budget itself?
I also asked three questions about items of background information relevant to this topic:
1. I am less familiar with the NI Executive’s budgetary process than perhaps I should be. I gather that there are multi-year budgets, linked to a programme for government, with annual estimates and possibly supplementary estimates. The multi-year element seems to be stronger than in Irish budgets, but I wonder whether (aside altogether from the current economic situation) it is difficult to make decisions within the constraints of the different budgetary timescales.
2. I have not yet checked all Waterways Ireland annual reports, but reading that for 2011 suggests that DCAL paid slightly under 14%, rather than 15%, of WI’s current expenditure. Are minor deviations from the 85/15 ratio unavoidable? Do they balance over time?
3. Do currency fluctuations affect the amounts actually paid by the two departments? If so, how are the effects taken into account?
I have not yet received a reply.
On 6 January 2014 I wrote to WI:
I would be grateful if you could tell me the effect on Waterways Ireland of the continuing dispute between its sponsor departments over WI’s budgets and business plans.
On 8 January WI said:
Waterways Ireland enjoys a supportive and positive relationship with both departments.
On 14 January I said:
I am very glad to hear it, but I don’t recall asking a question about that.
I repeated my original question, to which I have not had a reply. As with NSMC, I don’t really expect WI to be able to say anything undiplomatic. However, I would have thought that there must be some inconvenience in working to “indicative allocations”. I wonder whether they are based on DCAL’s preferred level of cuts, DAHG’s preferred level or some compromise. And if compromise is possible on the indicative allocations, why can’t the main issue be sorted out?
Furthermore, the delay in publishing the 2012 accounts suggests that there has been some real difficulty in operating under the indicative allocations regime. Or perhaps there is some other row altogether.
Reporting yesterday to the NI Assembly on the November NSMC meeting, the NI Minister confirmed that there was disagreement.
Karen McKevitt [SLDP, South Down]: […] The chief executive set out a strategic direction for Waterways Ireland for 2014-16. In that, she mentioned budget efficiencies. Can the Minister highlight to the House what those might be?
Carál Ní Chuilín [SF, Belfast North]: The Member is right: the new chief executive gave us a very good and detailed presentation. Indeed, the Member will be aware — if she is not, she will be when I finish my answer to her question — that there have been additional pressures on everybody across the board in achieving efficiencies. However, as I have repeated to the Member and to other Members, and despite the meetings that I have had with Minister Deenihan around any proposed additional efficiencies that the Irish Government are saying are required, I am totally reluctant to go above and beyond any efficiencies that we agreed previously, and I have stated that to the chief executive of Waterways Ireland. That is the position. Following that, the Finance Departments and, indeed, officials and Ministers will hopefully be submitting additional or new budget plans very soon. I think that issues relating to any agreement to additional efficiencies lie beneath the Member’s question, but I can categorically state that I have not agreed to those.
“Efficiencies”, by the way, means “cuts”.
I have remarked several times here that Sinn Féin asks many Dáil questions about waterways, notably the Clones Sheugh, with Maureen O’Sullivan providing recent competition. I wrote elsewhere recently:
Waterways Ireland is a political creation: its very existence reflects a nationalist and republican desire to show the benefits of all-Ireland institutions — and a unionist desire to confine such institutions to areas of minor importance. […]
In prosperous times, managing recreational waterways is a feelgood activity, combining opportunities for local and national politicians to get their photos in the papers with relatively low risk of political controversy. Nonetheless, WI had to tread warily, especially in its early years; it has almost (but not quite) entirely avoided such controversy.
I don’t know if there is ever a good time for disputes between your paymasters, but it’s not as if Waterways Ireland, and its new CEO, didn’t already have enough to worry about. To quote again from the same piece:
Compared with British Waterways and C&RT, Waterways Ireland has very little real property from which it might derive an income — and very few other sources of income. According to its accounts for 2011 (the latest available), its total income was over £38 million but it earned less than half a million pounds from licences, property, interest, operating income (including charges to waterways users) and other sources. The rest came from its two sponsor departments.
Charges to boaters have traditionally been low or non-existent: zero for a boat kept on the Erne or on one of the Shannon lakes, with modest charges for passing through Shannon or Shannon–Erne Waterway locks; on the Grand, Royal and Barrow, an annual charge of €128 covered lock passages and mooring. There was no licence fee. Waterways Ireland has begun to impose slightly higher larger charges but may meet resistance.
But there is no immediate prospect of imposing charges high enough to make a significant difference to Waterways Ireland’s budget. That budget is set by the North South Ministerial Council: each government pays for capital works (eg harbour improvements) carried out in its own jurisdiction, while the running costs are paid in a ratio intended to reflect the proportion of the waterways in each: 15% by the Northern Ireland Executive and 85% by the republic’s Government.
Some difficulty may be caused by different timings of the budgetary processes in the two jurisdictions, but a greater problem is that the fixed ratio can lead to deadlock. WI’s budget for 2012 was not set until July 2013, eighteen months late: its budget, business plan, annual report and draft accounts for 2012 were all set on the same day. Final accounts for 2012 had not been published and WI’s budget for 2013 had not been agreed by December 2013.
The cause of the delay was that the republic’s government wanted to cut the budget by more than the Northern Ireland Executive did. The Irish economy has had severe problems in recent years and the government was unable to honour its undertaking to pay for the restoration of the Ulster Canal from Lough Erne to Clones (a short stretch that crosses the border several times). Public expenditure has been cut for all government departments and public bodies but the scale of the cuts is larger than the Northern Ireland minister wants to see. If the republic’s government gets its way, by 2016 WI’s budget will be one third lower than it was in 2010.
That is not the only financial problem that WI faces. Staff transferred to it from Irish government departments carried with them their entitlements to pensions of half of final salary plus retirement lump sums of one and a half times final salary. And, as is the norm in the civil service, the pension system was unfunded. WI had quite a few staff in their fifties and, as they now retire, their pensions and lump sums have to be met out of WI’s normal income from its sponsor departments. The pace of retirement may even by accelerated by a desire to avoid charges arising from the Hutton pension proposals.
During the era of the Celtic Tiger, Waterways Ireland prospered: it acquired much new equipment, built new offices and developed and improved facilities for boaters and other users. It now faces a much more difficult financial future and it is hard to see how it can avoid reducing its level of service. At the same time, its new CEO is — rightly — determined to continue widening the appeal of the Irish waterways to more types of users: walkers, cyclists, anglers, canoeists and others.
Maybe the two ministers might get their act together.
I will report later on other items covered in Ms Ní Chuilín’s statement; the bad (if unsurprising) news is that she is still stuck on the sheugh, but perhaps she can persuade the Imperial Treasury to pay for it.
Posted in Economic activities, Extant waterways, Foreign parts, Ireland, Irish waterways general, Operations, People, Politics, Tourism, waterways, Waterways management
Tagged budget, cuts, dahg, dcal, department of arts heritage and the gaeltacht, department of culture arts and leisure, economy, financial memorandum, Ireland, North South Ministerial Council, Northern Ireland Assembly, Northern Ireland Executive, northsouthery, NSMC, Operations, waterways, Waterways Ireland
Let us suppose that you are an Irish civil service department, whose staff are employed on standard Irish civil service terms.
And let us suppose that your Secretary General’s 65th birthday was on 31 December 2013, by which time she had 40 years’ pensionable service. Her salary was €250,000 a year, so that’s the amount you (the department) paid to her in y/e 31 December 2013. Because of cutbacks, she is replaced, from 1 January 2014, by someone earning half that amount. So what is the cost of SecGens in 2014? Keep it simple: ignore employer’s PRSI and allowances and travel expenses and anything else.
In 2014, you will pay the new SecGen €125,000, half the old rate, but you will pay the retired SecGen €500,000, so your total expenditure on SecGens will rise from €250,000 to €625,000. [The timing may not be quite thus, but never mind.]
In 2015, the new SecGen will continue to get €125,000, but so will the old SecGen. So, even though your new SecGen gets half what the old one earned, the total cost to you remains the same.
And so on until the old SecGen dies. But if the new SecGen retires before that, you will have two retired SecGens drawing pensions and one even newer SecGen getting a salary ….
Under ordinary Irish civil service terms, someone who retires is entitled to a pension of one eightieth of final salary for every year of service, up to a maximum of forty years. So a SecGen who started, say, as a graduate entrant at the age of 25, stayed in the civil service and retired at age 65, would be entitled to a pension, for life, of half her final salary.
She would also be entitled to a lump sum of one and a half times her final salary. That’s why, on retiring, she gets an amount equal to twice her final salary: 1.5 times salary as a once-off lump sum plus 0.5 times as pension.
You could argue that that is an absurdly generous arrangement, but that’s not my point here: someone who started work 40 years ago under those conditions can’t be criticised for taking the money they’re entitled to, and it will be a long time before any revisions could take effect.
These pensions are defined benefit, non-contributory and unfunded: no money is put aside by either employees or the employer to meet pension payments in future years. It is assumed that the taxpayer will continue to meet the increasing costs.
Now, that’s all very well for the main-line civil service: it has been in existence for a long time; it’s very large, with a large pay bill; it has had SecGens retiring before and another retirement or two won’t greatly affect the overall cost.
But if you’re a relatively small organisation, dependent on the exchequer for most of your income but without any of getting extra money to pay for pensions, the retirement of one or two senior officials, or of larger numbers of lower-paid employees, could significantly increase your costs while doing nothing to improve your income or the amount of work you do.
That is happening to Waterways Ireland at the moment. I’ll give some details shortly, but first I want to get the pension scheme out of the way.
Here is Wikipedia’s version of the tongue-twister about the woodchuck:
How much wood would a woodchuck chuck
if a woodchuck could chuck wood?
A woodchuck would chuck all the wood he could
if a woodchuck could chuck wood!
Coverage of the Waterways Ireland pension scheme in its annual reports reminds me of the woodchuck. I should say immediately that that is not a criticism of WI: it’s down to an accounting standard called FRS 17.
As far as I can make out, this standard requires WI to show in its accounts the entries that it would make for its pension fund, if it had a pension fund, even though it doesn’t have one. It does have a pension scheme, which I imagine sets out the rules about who is entitled to get what, but there is no pot of money put away, guarded by fierce trustees, to ensure that the pensioners of the future will get their money. Here is how I understand it; if I’m wrong (which wouldn’t be surprising), do please correct me in a Comment below.
WI’s balance sheet shows (for 2011) a liability of €66,432,000 and a balancing asset of the same amount; both of them are imaginary figures. Similarly, the income and expenditure account shows the amount that WI (in theory) should have paid in 2011 for the pension benefits that its staff accumulated in that year, along with an imaginary interest charge on its total liability. Those are then balanced by a figure called “Net deferred funding for pensions” which, at €4385000, is by far the largest component of WI’s “Other operating income”.
Obviously that lot would look better if it had corroborative detail to provide artistic verisimilitude, so the accountants or the pensions bods or someone did other calculations of currency translation charges and transfers in and out of the scheme and service costs and so on, all on a non-existent pension fund.
Now, as far as I can see, we can ignore all that. But there are two cash figures that are real and important:
Incidentally, WI’s 2011 accounts (the most recent available) make no mention of the North South Pension Scheme (see below), of which WI is a member. Perhaps the stuff in WI’s accounts is about its imaginary portion of a combined but equally imaginary fund under the North South Pension Scheme. The meetings of the NSPS CEO Pension Committee, which “exercises trustee-like functions” [seriously: see below], must be fun.
Not being an accountant (I feel I lack the necessary creativity), I am interested in the actual cost to WI of the benefits it pays out to folk who retire.
I asked WI how many people retired in 2012 and 2013 and how many were expeected to retire in the next three years.
Figures for 2012 and 2013 are actual; those for later years are expected. Source: Waterways Ireland
Those who retired were:
WI could not say what grades were expected to retire in 2014, 2015 and 2016. If they did, of course, I’d be able to guess which senior managers were about to retire; as it is, I have to rely on rumours. WI was able to predict the lump sum and pension payouts for 2014–2016, so I suspect it has a good idea who intends to retire.
The total number retiring in those five years is 81, which is about a quarter of the entire WI staff (currently 325). That’s a big proportion of the staff. No doubt it reflects the age profile of staff who transferred into the organisation but the figure may be boosted by the Hutton Push [see below].
Here is what WI expects to pay out in retirement lump sums in 2014, 2015 and 2016, and what it actually paid out in 2012 and 2013. Note the big increase in 2014. These sums are paid on retirement and are not recurring: in other words, they are made only to those who retire in the year in question.
Actual amounts for 2012–2013; predicted amounts for 2014–2016. Source: Waterways Ireland
If all lump sums are 1.5 times final salary [something of which I can’t be certain], then we can work out the total of the final salaries of the retiring employees.
Source: actual and predicted lump sum payments divided by 1.5
And, as we know the number of people expected to retire in each year, we can work out the average final salary for each year.
Source: actual and predicted total final salaries divided by numbers of retirees
It looks as if some senior staff may be expected to retire in 2014.
The lump sum amounts are paid only to those retiring in the year in question, whereas the annual pension payments include those to people who started drawing pensions in 2011 and earlier years. But the lump sums are once-off, whereas the annual payments will continue to increase as more people retire.
Source: Waterways Ireland figures for actual and predicted total pension pay-outs less lump sums
The totals of the lump sums and annual pension payments show how much WI has to pay out in each of the five years.
Totals of actual and predicted pension pay-outs. Source: Waterways Ireland
The figure shown in the 2011 accounts was €934000. By 2016, the total will be two and a half times that: €2377000.
Remember that this is an unfunded pension scheme, so the increase comes out of WI’s ordinary allocation of money from its sponsor departments. And that allocation will not be increased: both governments want to cut WI’s income, although one government wants to cut more than the other does. If the RoI government has its way, by 2016 WI’s income will be just under 66% of the 2010 figure: a cut of one third in six years.
According to the last available accounts, WI’s main cost is staff: €21,903,000 in 2011. But that figure includes €5769000 in pension costs, €934000 of which was benefits paid out while the rest was special magical imaginary payments to the pension fund; the real staff cost (excluding agency staff and employer PRSI/NIC contributions) was €14411000.
Between 2011 and 2016, the increase in pension costs means that an extra €1443000 has to be found and, as staff costs form the main element of WI’s expenditure, it is likely that the staff budget will bear much of the burden.
One factor that may be prompting some WI staff to retire as soon as they can, thus pushing up the lump sum payments in 2014, is the possibility that some changes, recommended by the UK’s Independent Public Services Pensions Commission [the Hutton Commission], might be applied to the North South Pension Scheme that covers Waterways Ireland. On 30 April 2013 Martin McGuinness [SF, Mid-Ulster, Deputy First Minister] reported to the Northern Ireland Assembly on the North/South Ministerial Council [NSMC] institutional meeting held on the previous day.
Jim Allister [Traditional Unionist Voice, Antrim North] asked him about the pension scheme:
The pension scheme for those bodies entails lavish employer contributions. In one case, over 31% of salary is contributed by the employer and a mere 1·5% is contributed by the employee. When will that lavish squander be addressed by bringing the scheme into line with what exists in the Civil Service scheme? Is it good enough for it simply to be pushed back for another six months? Why not address it now instead of looking at it further down the road?
The ever-patient Martin McGuinness responded:
At the NSMC meeting on 28 March 2013, we noted that the NSMC approved an amendment to the North/South pension scheme, which means that increases to the scheme for benefits paid in the northern currency will be in line with the consumer price index. Prior to that, they were increased in line with the retail price index. The amendment ensures that the North/South pension scheme follows public sector pension policy, as agreed by the Executive.
We also noted that the two Finance Departments are in discussion about how to further amend the scheme. These amendments will ensure that northern members are not immune from pension reform. The first amendment will increase employee contributions on average from 1·5% by 3·2 percentage points. That will align with the employee rates payable from April 2014 in the principal Civil Service pension scheme here in the North. The second amendment will introduce, by April 2015, the wider Hutton reforms, such as the introduction of a career average revalued earnings scheme and a linkage between the North/South pension scheme age and the state pension age.
The scheme was raised in the Dáil on 17 December 2013 in a written question to the Department of Public Expenditure and Reform.
Dara Calleary [FF, Mayo] asked the minister:
[…] the discussions he has had in relation to the North/South pension scheme; if the proposed amendment rules as notified from officials in the Department of Finance and Personnel and his Department will apply to southern based employees of Waterways Ireland; and if he will make a statement on the matter.
The minister, Brendan Howlin [Labour, Wexford] replied:
Five of the six North/South Implementation Bodies, including Waterways Ireland, along with Tourism Ireland, operate the North/South Pension Scheme (NSPS). The Scheme is unique in covering public sector staff employed on both sides of the border; staff of the affiliated employers in this jurisdiction are automatically members of the Scheme. The Chief Executive Officers of the relevant NSPS bodies and Tourism Ireland meet as the NSPS CEO Pension Committee, which exercises trustee-like functions in relation to the Scheme.
As Minister for Public Expenditure and Reform, I am jointly responsible, along with the Northern Ireland Minister for Finance and Personnel, currently Mr Simon Hamilton, for the rules of the North/South Pension Scheme, and in particular for approving amendments which may be proposed to those rules. In exercise of my responsibilities in relation to the Scheme, I and my officials have engaged in correspondence and discussion about reforms to the NSPS rules with my counterpart Northern Ireland Minister and his officials.
Review and reform of existing pension arrangements, including public sector pension arrangements, has been an ongoing feature of the pensions landscape in Ireland and the UK over recent times. In this context it is natural that reforms to the North/South Pension Scheme would arise for consideration, and proposals in this regard have been discussed with the NSPS CEO Pension Committee.
Pending further development of these proposed reforms, and mindful that there is ongoing discussion with trade union interests on the proposed changes, I do not intend to elaborate at this juncture on the possible final specific content of the rule amendments which may arise. I can however confirm to the Deputy my intention that the changes will, to the extent that is consistent with legal norms in each jurisdiction, apply to southern and northern NSPS members alike, including staff of Waterways Ireland in this jurisdiction. This uniformity of application would reflect the fundamental all-Ireland character of the Scheme, to which successive Governments have been committed.
That doesn’t tell us much about the likely effects on the take-home pay of WI staff, or the pensions and lump sums of retired staff, and I have no inside information about what is proposed or likely. But you can see why WI staff who are near retirement age might be tempted to get out before their conditions are worsened.
Posted in Economic activities, Engineering and construction, Extant waterways, Foreign parts, Ireland, Irish waterways general, Non-waterway, Operations, People, Politics, Sources, Uncategorized, waterways, Waterways management
Tagged dahg, dcal, defined benefit, department of arts heritage and the gaeltacht, department of culture arts and leisure, forty eightieths, Hutton, Ireland, lump sum, non-contributory, North South Ministerial Council, north south pension scheme, Operations, pension, Waterways Ireland
Irish waterways history 