Pension, pay and golf perks slashed at AIB
STAFF at State-owned AIB are reeling from news of massive pay and benefit cuts.
The bank outlined the latest plans to make an estimated €30m in savings, part of a €200m cost cutting effort that includes 2,500 redundancies.
Golf club memberships, company cars and special rates on banking products will all be taken away within months, staff were informed.
Pay cuts of up up to 15pc will hit top managers and "gold plated" defined benefit pensions will be ended for all staff.
Other senior managers face pay cuts ranging from 15pc to 7.5pc, under the plan.
Middle management and ordinary bank staff will not be hit with pay cuts, but a pay freeze in force since 2008 is to be extended until 2014.
It comes as AIB finalises an overall restructuring plan due to be approved by the EU authorities later this summer.
CEO David Duffy told staff that providing a Defined Benefit Pension is "prohibitively expensive."
He said the bank intends to move all employees onto defined contribution pension schemes, where payments vary depending on the performance of invested pension funds.
Defined benefit schemes were being phased out for new starters at all of the main banks before the financial crisis.
Bank of Ireland continues to operate a modified version of the scheme after cutting its pension deficit from €1.4bn to less than €5m in the past two years.
But Larry Broderick of the IBOA banking union said ending defined benefit pensions will save little for the bank, but will have a significant impact on ordinary bank officials.
SIPTU, which represents canteen staff, security and other non banking AIB staff said the move would be resisted.
The cuts were announced in an email sent to staff.
AIB chief executive David Duff's salary is to be cut by €75,000 to €425,000.
Up to now, AIB covered 50pc of club membership fees up to €1,250 for the rank and file, and 100pc of subs up to €2,500 for management.
From September 1 the bank will no longer offer favourable lending and savings rates to employees.