Sisters and Brothers,
|Pensioners demand government ACTION NOW!|
With more than 2000 companies under bankruptcy protection across the country right now, protesters were demanding change to the Bankruptcy and Insolvency Act in order to protect pensioners, terminated, and disabled employees who must now stand in line with bondholders and suppliers who can be insured against their risks.
Canada fighting for Pension Reform
|Letter to all TCRC Division Secretary Treasures...|
Please take a few minutes to take part in the important campaign.
Brothers and Sisters;
The following are the TCRC’s foremost concerns in the present review of the Federal Pension Benefits Standards Act (1985)
- The present Federal Pension Benefits Standards Act (PBSA)
1985 should be strengthened to better protect employee pensions
rather than weakened to favour corporations.
- At the present time the PBSA (1985) allows a corporation to
defer paying a pension plan deficit for up to five years and in
addition up to ten years with certain restrictions. Proposed
changes would allow corporations to defer pension deficits for
ten years without any restrictions whatsoever. Employee
representatives, including unions, ideally want to maintain the
present legislation. However, if the legislation is changed we
are requesting that all pension plan members must authorize any
deferment of pension plan solvency deficit payments beyond five
- Often when a pension plan is wound up a company is going out
of business. If this is the result of a bankruptcy payment of
debtors has precedence over payment to a pension plan which has
a deficit. Changes should be put in place that will give pension
payments preference over payment of all other debts. In addition
to this proposed changes would allow a plan sponsor to defer a
deficit for five years after a pension plan is wound up. We are
against allowing a plan sponsor to have five years to repay a
pension plan deficit. Simply put, it may be hard to locate a
plan sponsor after five years. If a pension plan is in deficit
all monies held by a corporation should be used to repay a
pension plan deficit at the time of the pension wind up.
- It is imperative that we have stronger legislation that
would strictly limit plan sponsors taking contribution holidays
especially when a plan has a deficit. The financial goal of
every pension plan should be to reach fully funded status as
soon as possible.
- Presently the Income Tax Act limits the level of pension
surplus threshold to 110%. The Income Tax Act should be changed
to allow at least 120% pension surplus threshold. This would
provide a financial cushion should the plan incur future funding
- The government should consider limiting the amount that pension plans are allowed to invest in equities and other risky financial ventures.
Yours in solidarity,