U of M pension takes 15.7% hit
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Hey there, time traveller!
This article was published 22/04/2009 (5151 days ago), so information in it may no longer be current.
THE University of Manitoba employee pension plan lost 15.7 per cent of its value last year — after several years of gains — in keeping with a national trend, university spokesman John Danakas said Tuesday.
Danakas said the U of M pension fund currently has a shortfall — current service costs less pension contributions — of $4.1 million.
The university administration is holding meetings with employees this week to explain the situation.
In an email to staff, university president David Barnard noted that the U of M’s pension fund investments have suffered less than those of other large funds, including the University of Toronto’s, which had a 29 per cent loss.
But he noted that since 80 per cent of the U of M’s budget is already allocated to compensation and benefits, with most of the rest going toward library materials, equipment and energy, “there is no unallocated pool of money that can be used to close the (funding) gap.”
The U of M’s pension woes came up Tuesday during question period at the Manitoba legislature, with the opposition Tories calling on the government to be “upfront” about plans to bridge the funding gap in the years ahead.
The Conservatives had obtained a copy of Barnard’s email.
“It’s a serious issue. It is presenting a financial crisis for the university — which is not alone by the way. There is a challenge at the University of Winnipeg and the other (public-sector) pension plans as well,” Tory Leader Hugh McFadyen said later outside the chamber.
The U of M pension hit comes on the heels of the City of Winnipeg announcing a 10 per cent decline in its pension fund. Meanwhile, the Teachers Retirement Allowances Fund dropped by 15 per cent and the Civil Service Superannuation Fund — the largest public pension fund in the province — plunged 13 to 17 per cent, the Conservatives said.
Premier Gary Doer said the government has yet to receive the U of M’s pension report.
However, he offered to work co-operatively with the university and employees to find a solution to any shortfall, much as the government did when health-care workers faced a similar situation several years ago.
“We’ll take a similar approach that everybody has to solve the problem,” Doer said.
Danakas said in addition to the recent market downturn, which eroded pension plan equity, the university has to grapple with long-term issues, such as the fact that pensioners are now living longer.
Larry Kusch didn’t know what he wanted to do with his life until he attended a high school newspaper editor’s workshop in Regina in the summer of 1969 and listened to a university student speak glowingly about the journalism program at Carleton University in Ottawa.