[Ontario] Public Sector Pension Merger - Questions to ask?

Preparing for life after work. RRSPs, RRIFs, TFSAs, annuities and meeting future financial and psychological needs.
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Hammerer
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[Ontario] Public Sector Pension Merger - Questions to ask?

Post by Hammerer »

Hi,

The single-employer pension plan (smallDBPP) is proposing to merge with a much larger multi-employer pension plan (bigDBPP).

If it goes through, everything is supposed to transfer 1:1.

bigDBPP is well managed and well funded.

It seems like a fair deal:

smallDBPP: saves on administrative costs, reduced investment fees since bigDBPP invests in-house instead of BlackRock. Less actuarial/black swan risk with bigger pool

bigDBPP: Gets extra investment funds. Marginal cost of managing xxxx more members is low

For us, bigDBPP has better discretionary inflation benefits, slightly reduced contribution %age, stability of larger plan and ease of credit transfer

Any particular questions to ask?

Everything seems great, but that feeling makes us worry a bit.

I used to work for an org under bigDBPP, but wasn't a plan member, so the merger will let me buy a small mount of credit back.
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big easy
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by big easy »

I think Torstar is one of those that is merging. Seems like a good deal for Torstar pensioners, especially if Torstar goes belly up some day. I wonder what happens to other benefits like drug plan, out of province health coverage etc. Do they switch over to the PPSP too?
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dsred
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by dsred »

Why the mystery? Details would help.
Hammerer
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by Hammerer »

dsred wrote: 03 Apr 2018 17:09 Why the mystery? Details would help.
What kind of details are you looking for? Other than the hard copy paperwork they mailed us, there isnt’t anything public I can link anyone to.
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by OhGreatGuru »

big easy wrote: 29 Mar 2018 15:43 I think Torstar is one of those that is merging. Seems like a good deal for Torstar pensioners, especially if Torstar goes belly up some day. I wonder what happens to other benefits like drug plan, out of province health coverage etc. Do they switch over to the PPSP too?
How can Torstar, a private corporation, have a "public sector pension"? Seems an irrelevant comment to OP's question.
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big easy
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by big easy »

Well the OP didn't really say what public sector pension plan he was referring to. Torstar may join the CAAT Pension Plan:

https://www.caatpension.on.ca/en
Created in 1967, alongside the Ontario college system, the CAAT Pension Plan is a Modern Defined Benefit (DB) pension plan serving 44,700 active and retired members from 38 employers across Ontario. The CAAT Plan is Ontario’s only postsecondary sector multi-employer pension plan, and the pension plan for the Royal Ontario Museum (ROM) and the ROM Foundation. As a jointly sponsored pension plan, decisions about benefits, contributions, and investment risk are shared equally by members and employers through their representatives on two governing bodies, who are appointed by the Plan sponsors: the College Employer Council, OCASA (Ontario College Administrative Staff Association), and OPSEU (Ontario Public Service Employees Union).
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Re: [Ontario] Public Sector Pension Merger - Questions to ask?

Post by OhGreatGuru »

Boy, you learn something new everyday. But if I were a member of CAAT, I would be very wary of the directors pursuing completely private sector employers as partners. The security of public sector or quasi-public sector pension plans is that the employers (with few exceptions) can't really go out of business. The pension plan can reliably count on future pension contributions from employers and employees. But to invite partners in from an industry that is nearly on the ropes?
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