Pension transition plan receives strong support
July 4, 2019
Members of the Queen’s University Pension Plan (QPP) have given their consent to move forward with the creation of a new jointly sponsored pension plan known as the University Pension Plan Ontario (UPP).
The results of Queen’s mail-in segment of the consent process were tabulated by a third-party, Mercer (Canada) Limited, which received consent ballots from non-represented members and objection ballots from inactive plan members over the past few months. The threshold required to achieve consent was two-thirds of active members indicating consent, and not more than one-third of inactive members filing their objection.
Combined with union consent provided on behalf of their members, both metrics were achieved. Consent thresholds were also met at the University of Toronto and University of Guelph, meaning consent was given to transition all of the universities’ existing pension plans into a single jointly sponsored pension plan, the UPP.
“Receiving the consent of our pension plan members is a major milestone and a critical step required by provincial regulators,” says Donna Janiec, Vice-Principal (Finance and Administration). “It brings Queen’s and the Ontario university sector one step closer to a new, sustainable defined benefit pension plan for the future.”
The process of informing the Queen’s Pension Plan members and navigating the consent process is the culmination of many months of collaboration, consultation, and hard work on behalf of numerous stakeholders at the three universities. At Queen’s, the administration, the Queen’s University Faculty Association (QUFA), the United Steelworkers (USW), the Canadian Union of Public Employees (CUPE), the Ontario Nurses’ Association (ONA), and representatives of the non-unionized employees through the Ontario Association of Non-Unionized University Employees, all made efforts to support the UPP. The Retirees’ Association of Queen’s (RAQ) also helped in getting the message out to existing pensioners.
“Representatives from the university’s unions and the administration all worked hard to share information about the UPP across a multitude of communication channels in order to ensure people had the information they needed to make informed decisions about consenting to the change,” Janiec says. “We are truly grateful for everyone’s hard work.”
Moving to a jointly sponsored pension plan greatly helps the universities and ultimately their members; it eases some of the regulatory constraints faced by single-employer plans, mitigates risk, and creates a larger pool of money to invest for potentially better returns. It is an effort that is supported by the provincial government and is a model for some of Canada’s largest and most successful pension plans such as the Ontario Teachers’ Pension Plan and the Ontario Municipal Employees Retirement System (OMERS).
The alternative, notes Janiec, was not status quo. A change was necessary if the Queen’s Pension Plan was to remain sustainable over the long term. And while achieving consent to proceed with the UPP is important, it is not the last step in the process.
The transfer of the existing pension plans into the UPP still involves several technical steps and additional approvals to proceed. The UPP is anticipated to be operational by July 1, 2021. It will be governed by both employers and plan members. Once established, other Ontario universities will have the option of joining.