Journalists who took early retirement from Independent News and Media have been told they will have to make their pay-offs last an extra year.
It is one of a series of drastic moves which have been proposed to save the pension schemes of Ireland’s Sunday World, Irish Independent and Evening Herald titles.
More than a dozen journalists working north and south of the Irish border, who took redundancy and early retirement last year from the Sunday World, are understood to have been affected by the IN&M proposal to push their retirement ages back from 65 to 66. Some who had budgeted for their pay-offs to see them through to 65, are now left wondering how to survive for a further year.
Meanwhile, journalists who are still working on the titles have been asked to take a major reduction in retirement benefits in order to save the majority of their pensions.
Journalists on the Irish Independent pension scheme are understood to have been told they must take only 61 per cent of the pensions they had been promised, and journalists on the Sunday World are understood to have been told they will get 80 per cent of their previous entitlement.
A number of Irish Independent journalists who took early retirement are also understood to be facing a year's extra wait before receiving their pensions. But unlike their counterparts on the Sunday World in the same position, Press Gazette understands that they have been given the option of taking a further 4 per cent reduction in pension and still receiving their money at 65.
The changes affect those on final salary pensions. Press Gazette understands that journalists who worked for Independent News and Media when it owned The Independent in London are not affected because it never offered a final salary scheme.
The chairman of trustees of the Independent Newspapers (Ireland) pension plan, Michael Doorly, has written to all those in that scheme to warn them it is facing “severe funding challenges” and has a Euros 127m deficit.
He has said that the plan “does not have sufficient assets to meet its past service liabilities”, adding “clearly this is a very serious situation”.
He said: “When we faced this situation in the past, the company and the members were in a position to address that deficit through higher cash contributions and, while it is the company’s intention to support a funding proposal, it is not envisaged that current staff members are in a position to contribute to the past service deficit on this occasion.”
One option is to wind up the plan, meaning current and former staff memberswould only receive 30 per cent of the benefits they had been promised.
The company is proposing to contribute an extra Euros 61.6m to the scheme over the next 11 years. But “given the company’s recent trading history”, this extra money cannot be guaranteed – Doorly has warned.
Those already drawing their pensions are not affected by the proposed changes. But those who have paid into the scheme and have yet to retire have been told they will only qualify for 61 per cent of the retirement benefit they had expected to receive.