The provincial government supports a request to extend extra payments to the pension deficit over 10 years instead of five, provided that all employee groups are consulted and that one-third of the membership do not object to the plan.
Consultations get underway across the campus this week. Each employee group is taking a slightly different approach. Members of the DFA and the NSGEU will be asked to vote; other groups, such as DPMG, will consult with membership and make a recommendation on their behalf.
Q & A
Information meetings are planned for each of the three campuses. Katherine Sheehan, assistant vice-president, Human Resources, and Lee Crowell, director of pension and employee benefits, will be available to answer questions and provide information.
“There is no risk to either current or future retirees as the result of a longer payment period, since this top-up funding concerns meeting obligations in the event that the fund is closed — an extremely unlikely scenario,” says Ms. Sheehan.
The potential for solvency relief comes as the result of a joint effort by the university and employees (including retirees) to the province. Solvency relief, simply stated, means a longer time to fund the substantial deficit.
“The university is committed to meeting the funding obligations, the question is at what cost to annual operating budgets,” says Ken Burt, vice-president (Finance).
An endorsement by employees will mean considerably less impact on the university’s operating budget.
One-third
If no more than a third of the plan’s membership object to the solvency relief, the university will start payments of $8.4 million on the pension deficit beginning April, 2011, a schedule that will continue for nine years.Â
However, if more than one third of plan members object to solvency relief, the university will be required to pay $12.4 million more annually than is planned under the solvency exemption scenario.
“Without employee support for the proposal, we will need to cover the deficit at a cost of $20 million every year for the next five years,” says Mr. Burt. “That money will come from our operating budget and will severely affect all of us and the way we deliver our services.”
The shortfall is directly related to the global recession. Dalhousie’s pension plan assets have experienced a recovery over the 19 months since February, 2009 — with a 27.9 per cent return from March 1, 2009 to Sept. 30, 2010.
“Any employee with questions or comments, please feel free to give us a call at 494-1122, email pensions@dal.ca, contact your employee group (or union) representative, or just drop by and chat with me,” adds Ms. Sheehan.
Pension sessions for all Dalhousie employees
2:30 – 3:30 p.m. 4 – 5 p.m. |