Nova Scotia introduces bill to extend wind-up of NewPage pensions
Yesterday, May 9th, the Government of Nova Scotia introduced legislation that could result in better pension benefits for the workers and pensioners of the NewPage mill in Port Hawkesbury.
“Government recognizes that buying annuities in today’s market could mean a significant loss of benefits for NewPage employees and pensioners,” said Minister of Labour and Advanced Education Marilyn More. “We are taking steps today to give these women and men an option that could result in some market recovery and some restoration of lost value.”
Within six months of a pension plan closing, its administrator prepares a financial report that compares the value of the plan’s assets with its obligations. After that report is approved by the province’s superintendent of pensions, annuities are purchased to provide plan members future pension benefits.
NewPage’s four pension plans are underfunded. If annuities were purchased now, pension benefits would be reduced by up to 40 per cent.
The bill introduced this week would give the NewPage pension plans up to 11 years to recover from low investment returns and interest rates. While there are no guarantees about future market performance or interest rates, long-term performance has been positive.
It would also give members information to help them make their choice, the right to opt in or opt out of the extended wind-up, and an annual update of how the plan is doing each year of the extended wind-up.
“This bill will give our pensions a chance to grow and to take advantage of higher interest rates in the future,” said Archie MacLachlan, vice-president of Local 972 of the Communications, Energy, and Paperworkers Union, which represents NewPage’s unionized workers. “Our members understand that there are risks involved in the stock market and that interest rates may remain low for many years.”
Three of the NewPage pension plans are for unionized workers in the mill, office and clerical positions and woodland operations and the other is for salaried, non-unionized workers. As of Sept. 30, 2011, the four plans included 646 active employees, 763 retired members, 46 inactive members and 53 deferred members.
Source: Government of Nova Scotia
- NewPage workers ask for legislative change to recoup some pension losses
- Nova Scotia's PC party perplexed why NDP refuse to support Pension Benefits Act
- Nova Scotia Government to delay NewPage pension windup
- 21 potential purchasers interested in the NewPage Port Hawkesbury mill
- Who is Ron Stern, and what are his plans for the Port Hawkesbury mill?
- Port Hawkesbury waiting for word about their mill
- Hurdles still to clear before NewPage Port Hawkesbury sale is finalized
- Port Hawkesbury Paper court decisions today