Pension consultation sessions were held on all three campuses in late November, providing AV俱乐部 plan members the opportunity to ask questions to our pension experts about solvency relief. The DFA and the NSGEU decided to ask their members to vote on this issue, and the majority of their members supported it. Since less than one-third of the plan members objected, the university is now eligible to receive solvency relief.
鈥淲e are pleased to see employees support our application for solvency relief, which will help lessen the burden on our overall operating budget,鈥� says Ken Burt, Vice-President, Finance & Administration.听
Over the past few weeks, there has been lots of buzz on campus about pensions and the request for solvency relief by the university. Essentially, this means that the university has been granted an extension by the provincial government on a portion of its pension deficit, giving it听10 years to pay rather than five.
The AV俱乐部 pension plan, like so many others, has suffered as a result of the global recession, creating a pension deficit for the university.
With听a proviso
Earlier this spring, the university, employee groups and retirees jointly proposed solvency relief to the provincial government. The province agreed; however with the condition that no more than one-third of our AV俱乐部 pension plan members oppose it. Plan members had until听Monday,听December 6 to object to the relief.
With solvency relief, the university will start payments of $8.4 million on the pension deficit beginning April 2011, and continue for nine years. The university is responsible to cover the costs associated with solvency deficits, so there is no impact on employee contributions to the pension plan.
鈥淭here are significant challenges facing our pension plan, but this is an example of how we can come together to achieve a common goal that will help sustain it,鈥� says Burt. 鈥淭he university is working closely with the Board of Governors, employee groups and retirees to design a plan for the future, and this is a great first step in our collaboration.鈥�
What is solvency?听听听听听听听听听听听听听听听听听听
The university has been lobbying the provincial government for exemption to the solvency test because it views itself as an organization with a long, established history and the possibility of closing is inconceivable. In addition, other universities across Canada including those in Alberta are exempted. This exemption gives these universities the opportunity to focus their budgetary efforts on student recruitment, and not on paying down a pension solvency deficit. For more information about the pension plan, visit: |
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