Pension conversion fallout lands in court
Pension specialist at Blake, Cassels & Graydon partner Kathryn Bush (J.P. Moczulski/The Globe and Mail) J.P. Moczulski/The Globe and Mail
Workers sue company after finding move to defined-contribution plan may leave them worse off
It looked like a good deal. Back in 1997, employees at what was then Riverside Forest Products Ltd., in Kelowna, B.C., were given a one-time offer: stay in their current pension plan, or switch to a new “defined-contribution” plan.
“Whether we’re choosing a new coat or a new car, we make our decision based on our unique personal needs,” a company bulletin told more than 200 employees. “When it comes to retirement planning, we all have different approaches to our retirement years. That’s why choice plays a key role in planning for the future.”
The company acknowledged that the new plan would no longer guarantee how much money employees would receive in their retirement. Each employee received a personalized package, complete with charts and graphs, that estimated how much they would receive under the new plan. Many agreed to switch.
In 2004, the company was taken over by Vernon, B.C.-based Tolko Industries Ltd. One employee who made the move to the new plan, worried about his future, decided to take another look at his pension with a financial adviser. The numbers, it is alleged in a lawsuit now before the Supreme Court of B.C., no longer appeared to add up. read more
Ontario offers pension overhaul
Changes would force companies to contribute more to provincial system
THE CANADIAN PRESS
TORONTO (Aug 25, 2010)
About 1.7 million workers and pensioners will be affected by a major overhaul to Ontario's pension system that will be debated this fall, Finance Minister Dwight Duncan said yesterday.
The proposed changes are intended to stabilize and strengthen Ontario's 8,000 defined-benefit pension plans and its pension benefits guarantee fund, the only one of its kind among the provinces.
The fund, which provides pensioners with up to $1,000 a month if their private-sector plan fails to provide its full benefit, has been an albatross for the governing Liberals, who have repeatedly warned that it hasn't been funded properly since its inception 30 years ago.
That looming threat came to a head last year during the global recession, when the fund didn't have enough cash to help thousands of workers at giants such as General Motors and Nortel that were poised to collapse into bankruptcy.
The fund got a $500-million boost in this year's provincial budget to cover claims stemming from Nortel's demise, and Duncan said the proposed changes should help keep it stable enough to meet current claims.
GM, which is no longer paying into the fund, contributed about $13 million last year, according to ministry officials.
The government won't follow through with a recommendation to increase the fund's top-up to pensioners to $2,500 a month, but it is proposing to raise the contributions companies make and other changes that could pull in about $30 million annually, Duncan said. read full story
The push for pension reform
Pension conference in Toronto brings together managers, industry experts
Canadians shouldn’t let “pension envy” enter in the debate over pension reform, the head of the Ontario Teachers’ Pension Plan said Tuesday.
This is a danger as the private sector increasing moves towards defined contribution pension plans and away from defined benefit plans, Jim Leech said during a keynote address.
Canadians are being told that defined benefit plans are unaffordable, but that is largely because of “short-sighted tax rules and court decisions that have effectively prevented sponsors from saving enough in good times to offset losses in bad times,” Leech said. read full story
Pension plans no healthier in 2010
Mercer calculates a typical plan only 74 per cent funded
Most pension plans in Canada have enjoyed no change in health so far this year, say benefits consultants at Mercer.
A typical plan that was fully funded in 1999 would likely have only 74 per cent of the funds required to pay employees' earned benefits if the sponsoring company became bankrupt. That's no better or worse than at the start of the year.
Mercer noted stock market gains were modest, while interest rates on government bonds held stable during the first quarter of the year. read full story
Pension Plans Yes! Savings Plans No!
Pensions for All with Guaranteed Defined Benefits!
A pension debate is underway in Canada. To take part effectively in the discussion, the working class must develop, and widely express and defend its own opinion. This opinion must organize themselves as an official workers' opposition that stands in sharp contrast to the official opinion of the owners of capital and their political representatives. A working class opinion that is not its own and is not organized as an effective official opposition both outside and within Canada's political institutions does not amount to much. It is akin to mumbling incoherently in the face of an ugly howling storm. read full story
A secure retirement for every Ontarian
Horwath calls for Ontario Retirement Plan to offer secure, reliable retirement option
QUEEN’S PARK – All Ontarians would have the opportunity to retire with the security of a decent, dependable retirement income under a new province-wide pension plan unveiled today by Ontario NDP Leader Andrea Horwath.
“No matter where they work, all Ontarians should be able to retire with dignity, security and without worry,” Horwath said. “An Ontario Retirement Plan is a sensible idea that would allow people who want to save for their retirement the chance to do so, wherever they work.” read full story
Liberal plan for Nortel pension bailout under fire
Ontario's vow to top up Nortel plan for pensioners in key by-election riding is 'callous
OTTAWA–The cash-strapped Liberal government promises to top up Nortel's underfunded pension plan – a move affecting many retirees in an Ottawa riding where a key by-election is being held March 4.
Opposition politicians say it's just another example of the government trying to buy votes.
"This is the most callous, mean-spirited thing I've heard," said Progressive Conservative MPP Lisa MacLeod (Nepean-Carleton). read full story
Ontario to top up Nortel pension
The Ontario government will pay into Nortel's underfunded pension plan.
Anxious pensioners will welcome the move that gives them greater assurance their cheques will continue to arrive.
A government source says the province will pay into the Pension Benefits Guarantee Fund so that pensioners will receive up to $1,000 per month. No details were provided. read full story
PENSIONS ARE A RIGHT!
For weeks on end the media (especially the Globe and Mail) have been running hysterical articles about the crisis in pensions.
It is high time that the discussion of pensions is put on a proper footing. What if pensions were viewed as a social program? What if pensions were viewed as a right and the wealth that is produced in the society is used to insure that everyone in the society is assured the right to a livelihood when they reach retirement age? Then the issue would be one of finding the realized added-value through taxation, not from individuals and small businesses, but from the enterprises that dominate the economy. Social pensions would tie in with the health of the socialized economy. read more
Reform Of Canada's Pension Regime
Pension Articles from the Media
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