Legislation on Defined-Benefits Pension Plans

Article from the newsletter Le Flambeau Express – June 2015

We are taking another look at this topic in the June issue because we expected that a bill to amend the current legislation governing supple-mental pension plans would be tabled in Quebec’s National Assembly before it closes down for the summer.

We just heard that the Minister of Labour, Sam Hamad, has tabled Bill 57 in the National Assem-bly, following an agreement between union bodies and the government members of the labour forum on defined-benefits pension plans.

We still don’t have the details of this bill, but rest assured that we will be taking a close look as soon as we are able to do so. We will then pre-pare a brief for the Parliamentary Committee that will be established on this matter.

This is a topic of concern for all RTAPP members no matter where they live, not just in Quebec.

With the legislation regarding municipalities now passed, the government will now almost certainly turn its focus on private-sector pension plans.

The RCRA is keeping an eye on what is currently being done to keep private-sector defined-benefits pension plans alive and well.

It has already begun meeting with members of the government and the opposition to share its thoughts on ensuring better conditions for pen-sioners.

In the meantime, the RCRA has prepared a brief, which it will need to work on some more before it can be tabled with the future parliamentary com-mittee for the private sector.

Remember that the RCRA’s mission is to protect the heritage and defend the rights and interests of all its members.

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Sale of Rio Tinto or Rio Tinto Alcan

Article from the newsletter Le Flambeau Express – June 2015

There are currently three potential sale scenarios: the sale of RTA’s Pacific Aluminium division, the sale of RTA, and the sale of Rio Tinto.

Glencore expressed its interest in 2014 with an of-fer of $150 billion for Rio Tinto. The offer was re-fused. Any future buyer of Rio Tinto could then turn around and try to sell RTA.

The RCRA has started reaching out to members of the National Assembly, seeking their support to protect pensioners. The RCRA will continue its awareness-raising efforts over the summer.

Bill to foster the financial health and sus-tainability of defined-benefit pension plans in the private sector

Article from the newsletter Le Flambeau Express – June 2015

The RCRA met with the National Assembly’s member for Jonquière and former minister Sylvain Gaudreault, the political assistant to Premier Philippe Couillard, and held a conference call with the political assistant to the Minister of Labour, Sam Hamad, and the head of the private-sector pension plan department at the Régie des Rentes du Québec (Quebec pension Board).

This is the information given to the RCRA:

  • The labour forum, composed of employers, union bodies, Force Jeunesse (a youth or-ganization), and the FADOQ (Quebec Seniors Association), met several times in an effort to reach a consensus regarding the funding of private-sector pension plans.
  • To the government and the RCRA’s sur-prise, the FADOQ withdrew from the com-mittee before the work could be completed and recommendations made, leaving retir-ees without any representation at this criti-cal stage.
  • The government plans to table a bill before the National Assembly closes down for the summer in June. The government will then establish a parliamentary committee in fall.

Once it has read the bill, the RCRA will work on its brief over the summer and present it to the parlia-mentary committee.

The RCRA will contact the FADOQ to express its disappointment with regard to the organization’s withdrawal from the forum, ending its representa-tion of retirees on the labour committee.

Indexation

Article from the newsletter Le Flambeau Express – June 2015

At the end of 2014 the plan was not in a good place in terms of the policy on indexation and what was being done with the surplus.

On June 16, at the Rio Tinto Alcan Pension Plan (RTAPP) annual assembly, the RCRA will call for ad hoc indexation in light of the considerable im-provement in RTA’s profit levels in 2014.

RTAPP fund performance

Article from the newsletter Le Flambeau Express – June 2015

The following table shows how the solvency and capitalization rates changed in 2014 and the first quarter of 2015:

Solvency                     Capitalization

Dec. 31, 2014              94%                                100%

March 31, 2015              92%                                100%

A long-term drop in the interest rate to 2.5% nega-tively affected the solvency rate. The RTAPP’s solvency rate reflects market changes.

At the end of 2014, the plan had $3.626 million in assets, compared to $3.436 million at the end of 2013.