Changes are afoot in the DB world in Canada. Private sector pension liabilities are increasing relative to the size of corporations. As a result, large swings in funded positions can have a significant impact on corporate balance sheets and cash flows. For many plan sponsors, this means that financial issues have become far more important […]
Governments looking to enhance the degree of benefit security provided by defined benefit (DB) plans face a major challenge in finding the right balance between various interest groups. A new acronym—PfAD—is rapidly creeping into the pension world’s vocabulary as a potential solution, but like many of the potential solutions, there are pros and cons. More […]
Many decades ago, pension plans were set up as a mechanism to ease older workers out of the workforce gracefully before they became a liability to their employer. In those days, pension plans typically fell within the purview of the senior human resource officer. As pension funds grew in size, and their risks—especially those of […]
A recent mini-survey by Watson Wyatt Worldwide of 40 major defined benefit(DB)pension plan sponsors in the United Kingdom revealed that the risk of mortality improvements is a far greater concern to them than the risk of a fall in equity prices or a fall in bond yields. North American plan sponsors may find this survey […]
Defined benefit(DB)plan sponsors are well aware of the effects of cost volatility in the context of their pension plans. This volatility affects both their funding contributions and the pension expense in their financial statements. In fact, this volatility is the most prevalent factor behind the major risk-related decisions being made by publicly traded sponsors of […]
Business leaders in Canada are well aware of the looming labour shortages that may grip their operations across the country. In a recent survey conducted jointly by Watson Wyatt and the Conference Board of Canada, CFOs and vice-presidents of HR were asked about their concern regarding the attraction/retention of highly skilled or high performing employees, […]
There is a lot to be said for defined contribution(DC)plans. From the plan sponsor’s perspective, they can alleviate concerns about cost volatility and funding deficits that are associated with defined benefit(DB)plans. They are usually better understood by the members than DB plans, because they look and feel like individual RRSPs. And we all know of […]
© Copyright 2006 Rogers Publishing Ltd. The following article first appeared in the September 2005 edition of BENEFITS CANADA magazine. DB: Can it be fixed? Without a closer look by governments and politicians, the Canadian defined benefit plan could become extinct. By Ian Markham The defined benefit(DB)pension plan system in Canada is a mess. […]