While there are nuances, I consider a target-benefit plan to be one that determines benefits to members on a defined benefit basis while setting out employer contributions on a defined contribution basis. To allow for that mix, target-benefit plans permit benefit reductions when contributions fall short. My goal is to share what I consider an […]
With former Sears Canada Inc.’ employees set to see a 30 per cent reduction in their pension benefits beginning Aug. 1, Benefits Canada looks back at the saga. June 2017 — Sears Canada announces it’s seeking protection under the Companies’ Creditors Arrangement Act as it faces a $308.6-million deficit related to its retirement benefit obligations. Read: Sears […]
Sears Canada Inc. retirees, through Koskie Minsky LLP, filed a motion in court on Friday seeking the retailer’s remaining cash to help fund their pension shortfall. While the plan’s deficit sits at $260 million, the company currently holds about $135 million, according to a recent report by FTI Consulting Canada Inc., the court appointed monitor for the retailer’s insolvency. If the […]
Canadian defined benefit pension plans posted a higher median solvency ratio at the end of the second quarter of 2018 in comparison to earlier in the year, according to new data from Aon. The median solvency ratio reached 100.2 per cent, which was up from 98.7 per cent in the first quarter of the year. […]
Canada’s defined benefit pension plans saw continued improvements in their solvency positions during the second quarter of 2018, according to Mercer’s latest pension health index. Representing the solvency of a hypothetical plan, the index stood at 107 per cent as of June 29, 2018, up one percentage point from the end of the first quarter. […]
Ken Eady understands the challenges a defined benefit pension plan can present for plan sponsors, particularly when they find themselves in financial difficulty. “Healthy companies aren’t always too crazy about the liability, so it can become a heavy weight to carry when there is trouble maintaining financial status. That’s why they seem to generally be […]
Since 2011, Norway’s national pension provider has been calculating the life expectancy of those turning 61 as part of pension reforms introduced at that time. It then factors the calculation into the pension benefits people in that cohort will receive. The National Insurance Scheme, which is the standard public pension Norwegians pay into during their […]
Sears Canada Inc. retirees are facing clawbacks to their pensions due to 10 months of overpayments. Since October 2017, the retailer’s former employees have been receiving 100 per cent of their entitlement, rather than the reduced rate that aligns with the plan’s underfunded status. Morneau Shepell Ltd., the firm overseeing the plan’s windup process, originally […]
Canadian group annuity sales reached an estimated $1 billion in the first quarter of 2018, according to Willis Towers Watson’s quarterly update. The significant volume of activity is largely due to a single large transaction. Recently, Alcoa Corp. completed an annuity buyout worth more than $700 million for about 2,100 pension plan members across Canada. […]
A new report by the C.D. Howe Institute says taxpayers are on the hook for the unfunded liability of pension plans for federal employees. In the report, authors William Robson and Alexandre Laurin argue that official figures for federal pension obligations understate future costs and leave many plans seriously underfunded. “The federal government in particular presents […]