THE GOVERNMENT was not involved in “a bailout” of pension schemes and measures introduced would be cost-neutral, Minister for Social and Family Affairs Mary Hanafin told the Dáil last night.

Ms Hanafin announced the setting up of the Pensions Insolvency Payment Scheme (Pips). This would allow trustees apply to the Minister for Finance to purchase pension payments for its retired members, at a lower cost than in the open market, in circumstances where a defined benefit scheme was in deficit and the sponsoring employer insolvent.

Ms Hanafin warned that the Government’s attempt to assist those in need should not be misrepresented.

She added: “Many people will want to know the bottom line on this and the difference it will make to their pension.

“The simple answer is that it depends on the scheme in question. Each scheme involved will have to be actuarially assessed and the costs and savings will depend on the age profile, the prevailing interest rate and other relevant factors.”

Introducing amendments to the Social Welfare Bill, the Minister said they would build on the short-term measures already introduced to assist pension schemes and support the trustees in meeting current challenges.

The Minister said she would be shortly announcing details of the Government’s national pensions framework, which would include a response “on the issue of the sustainability of the pensions industry”.

Opposition spokesmen and women strongly criticised the short notice given to them of the Government’s proposals.

Fine Gael’s Olwyn Enright said that members needed to consult and engage with people to gain their views and get expert opinion.