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Thursday, November 09, 2006

BC Pension Rule Slashes Pensions of Retired Construction Workers

BC Pension Rule Slashes Pensions of Retired Construction Workers

For immediate release
November 9, 2006

VANCOUVER, BC: Pension fund advisors, a pension fund trustee and a former representative of BC’s construction industry today gathered at the Morris J. Wosk Centre for Dialogue to warn the public about a BC Pension fund regulation that is causing huge rollbacks to the pensions of retired BC construction workers.

“Current BC pension rules require pension plan trustees to set aside enough funds to cover these plans should they terminate at any moment,“ explained pension fund consultant Harvey Mason of D.A. Townley and Associates. “With the multi-employer plans that we advise on, the entire construction industry would have to collapse for these funds to fail – an extremely unlikely event given the $100 billion currently slated for construction here in BC.”

“We conservatively estimate that the cost of this one bureaucratic rule (referred to as the solvency rule) could add $1.00 to $2.00 an hour to our pension costs,” over the next two to three years said Harry Satanove, an actuary at Satanove & Flood Consulting. “As the contracts have already been negotiated, and the pension plans along with them, the only way to fund these entirely hypothetical costs is to reduce benefits - both future pensions for current workers, and in some cases pensions in pay for retired workers. The solvency rules do not benefit anyone – they do not benefit the employers and they do not benefit the workers, as they likely won’t ever see one cent of this money.”

“Worse yet, these rules that were supposed to protect pensioners have instead resulted in payments to our pensioners being reduced by up to 15%,” said Pension Fund Trustee Dave Beatty. “This is causing real hardship for some of our senior citizens and we think that the government needs to take action immediately by following the example set by the Government of Alberta.”

“We have met with government regulators but all they are willing to do is review the issue on a case-by-case basis and without offering much relief,” said Satanove. “In Alberta the government responded by suspending this regulation for three years,” noted Satanove, “and we are asking the government of BC to do exactly the same thing and use the time to engage in some proper consultation with both industry and pension groups.”
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For further information please contact:

Harry Satanove Harvey Mason Mike Geoghegan Dave Beatty
(604) 323-9363 (604) 299-7482 (250) 881-0969 (604) 709-3008

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