It has been announced that pensioners who earn an average of €16,000 each year  will face cuts to their payment as new proposals that are intended to put an end to a long running dispute surrounding the insolvent retirement fund operated by Dublin Airport Authority and Aer Lingus.

The cuts surround the trustees of the Irish Airlines Superannuation Scheme who are seeking to implement a new legislation to retrieve benefits that have been paid from the fund to pensioners. In what would be the first initiative of its kind they are hoping to mend its €780 million short coming and put an end to the dispute that threatens close business in the country’s main airports.

The proposed cuts will affect 4,000 pensioners, who receive an average of €16,000under the scheme. The Social Welfare and Pensions (No 2) Act, 2013 that came into place last year allows retirement fund trustees to cut the benefits of pensioners when and if the scheme is ever in trouble.

This will be the first time that anyone has enforced the new act which also proposes a 20% cut on benefits built up by staff currently contributing to the scheme. It is hoped that the controversial move will help divert a strike that threatens to ground Aer Lingus and shut Cork, Dublin and Shannon airports in March.