Former employees of P&T's Harmac pulp mill in Nanaimo, B.C., call for pension regulation after company left fund underfunded
April 8, 2009
(The Daily News (Nanaimo))
– Former Pope and Talbot employees want a meeting with Finance Minister Colin Hansen about what they call a crisis in how pensions are regulated in B.C.
A group made up of former salaried Harmac employees wrote Hansen asking for the meeting after they were dissatisfied with a meeting with a Financial Institutions Commission bureaucrat. FICOM is the provincial pension regulator in B.C.
PT Salaried Retirees Group has 107 retirees in its membership, including 67 from Nanaimo. All are worried about the future of their pensions after FICOM allowed Pope and Talbot to leave the pension account underfunded throughout most of this decade, right up until the company went bankrupt last April.
About 300 workers in B.C. contributed to the plan. About half are still working. The underfunding has left all contributors wondering what, if anything, they will get at retirement and those already receiving pensions now have to worry about a clawback of money already paid to them.
The situation is so worrisome they want the provincial government to take action.
"We feel it's a crisis," said Don Campbell, the group's recording secretary. "He's seen our letters, now talk face to face with us for a few questions."
The ad-hoc group formed after the Harmac pulp mill's former owners went bankrupt. The majority of the group's members are from Nanaimo but it includes other former Pope and Talbot employees from the B.C. Interior.
After the Portland, Ore.-based company went bankrupt, FICOM appointed consultants Morneau Sobeco to wind up the pension plan. That process is expected to be complete later this year.
In the meantime, some former employees have received bad news from Morneau Sobeco.
Ian Brand of Ladysmith has lost his health-care coverage, costing him $3,400 a year, and has had his pension payments cut by 25%. He also recently learned that he may have to pay back some of the money he has already received.
"The whole problem with this, you don't actually know until they come down and say: 'This is how much you've got coming,'" Brand said. "Everybody realizes you'll have less of a pension but nobody knows how much."
Pensioners blame FICOM for not doing enough to make sure Pope and Talbot met its obligations to fully fund the pension, even though it was found to be seriously short seven years ago.
A three-year audit of the fund found it 78% funded in 2003, and FICOM ordered it topped up. But it was still 14% underfunded last year when the company went bankrupt, even as seven members of the company's senior management were being cut bonus cheques at company headquarters in Portland.
Employees are last to get paid in a bankruptcy. Pensions are required to have sufficient funds to give retirees a steady stream of income throughout retirement.
The frustrated pension-plan members want government to fix the regulations that currently allow employers to get away without topping up underfunded pensions.
"We as a group want (Hansen) to know we're disappointed with what happened and we would like government to look into this, to look into why it failed," said Campbell.
The ad-hoc group has support from NDP MLA Leonard Krog (Nanaimo) and Liberal Ron Cantelon (Nanaimo-Parksville). While both are sympathetic, so far even Cantelon's ministerial position hasn't helped get them what they're asking for: a meeting with Hansen.
"Maybe it will help us. We hope it will but at the same time down the road it could help other pensioners," Campbell said.
A ministerial aide said Hansen was in the Interior and could not be reached for comment Tuesday.
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