Belfast Telegraph

Shutdown of Northern Ireland Rural Development Council blamed on pensions and political limbo

Disappointed: Tony McCusker
Disappointed: Tony McCusker
Margaret Canning

By Margaret Canning

An organisation set up to help rural areas in Northern Ireland has said political instability is partly to blame for its decision to close down over a shortfall in its pension fund.

The Rural Development Council (RDC), based in Cookstown, was set up in 1991 to support rural areas across the province.

It is led by chairman Tony McCusker and chief executive Teresa Canavan, and has seven members of staff.

It is now preparing to close following a creditors' voluntary liquidation because of a deficiency in its pension fund of more than £3m.

A creditors' meeting is to be held at the offices of insolvency solicitors Napier & Sons in Belfast on March 28.

The RDC was set up as a government body, with staff qualifying for a pension through the local government pension scheme, administered by the Northern Ireland Local Government Officers' Superannuation Committee (NILGOSC).

However, after the Review of Public Administration, it became an independent company, and later a registered charity.

Sign In

The RDC said: "At the time of change there was no reason to believe that future pension demands would threaten the solvency of the organisation."

The council's board said it was closing due to circumstances beyond its control.

But NILGOSC said it was not able to comment on a specific employer within the scheme and added: "In any circumstances where a scheme employer ceases to function, the pensions of members are secured and suffer no detriment."

The RDC is estimated to have paid in around £420,000 to shore up its pensions since 2014, with the contribution for April 2018/19 put at £187,000.

Nonetheless, the deficiency has escalated to around £3m, with the funding crisis leaving it with no option but to enter a creditors' voluntary liquidation.

Mr McCusker said: "A series of unfortunate circumstances, including a substantial pension deficit, a continued annual hike in pension costs, the inflexibility of the NILGOSC pension scheme regulations and a lack of political stability, have all played a part in the closure.

"We have witnessed a number of charities closing over recent years, with increasing pension costs often being the main contributor.

"For us it is extremely frustrating and disappointing that our local government pension scheme is not doing more to protect Northern Ireland charities in the way that other government schemes are across the UK."

He said the Government needed to find solutions other than insolvency for organisations to leave the scheme.

Mr McCusker added: "RDC has worked with and supported over 7,000 rural projects during its 28 years in operation.

"We hope that those communities empowered by local action continue to champion rural issues and we thank all those who we worked with over the years for their commitment and dedication to advancing rural Northern Ireland."

It had been suggested the council could have benefited from a letter of guarantee from the Government, in which the Government would pledge that it would honour pension contributions in the event of collapse.

But partly because of the lack of an Executive, it has not been possible to obtain such a letter.

The Department for Agriculture said: "The RDC is not a public body and the department has no responsibility for the RDC pension liability.

"There would be no reasonable basis upon which to make a request for permission to guarantee such a liability."

Belfast Telegraph