What is the average assumed growth rate in these defined pension funds?Outlawing defined benefit schemes does not benefit the employee.
They should be outlawed.
The typical costs p.a of a DB scheme assuming no deficit is in excess of 25% (40-60% for public sector employees).
Typical employee contribution 5-8%
The employee does not bear any of the risks associated with the scheme. If anything goes wrong the employer must make up the difference (assuming he has not gone bankrupt). For example, people living longer, assets not preforming, pension levies (paid by the company), etc.
The funding deficit in Irish schemes today is a primarily as a result of people living longer and the poor investment returns. Regardless of the reason for the deficit the company remains liable.
Any Irish employer who is still providing this type of scheme needs his head examined. The company receives little thanks from employee but carries a huge risk.
Closing the scheme to existing and new members eliminates all the risks and will in all probability vastly reduce his costs.
However one big advantage of outlawing these schemes would be the huge reduction in the costs of Public Sector pensions