Doug Hempstead of the Ottawa Sun has reported that the Ontario finance minister Dwight Duncan is expected to announce a bailout package for Nortel pensioners.
The Ontario Government will pay into the Pension Benefits Guarantee Fund (PBGF) so that Nortel pensioners will receive up to $1,000 per month.
Currently Nortel's pension plan is about 30% underfunded, but the PBGF doesn't have enough money in it to cover the difference.
Minister Duncan is expected to announce that the Ontario government will top up the heavily used, 30-year-old PBGF so Nortel pensioners affected by the company's bankruptcy protection will still get some pension benefits.
Ontario is the only province with a PBGF, so the announcement is expected to only affect Nortel pensioners who were based in Ontario.
Sunday, February 7, 2010
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CTV News 8 Feb10 "Ontario Vows to help Nortel Retirees" news clip is available on YouTube.
ReplyDeletehttp://www.youtube.com/watch?v=pQDqxn6NjSw
Not a bailout, it's a LOAN to the PBGF. The funding for the PBGF comes from fees paid by all pension plans in Ontario. Obviously, in the current economic crisis, the past fees were not set high enough.
ReplyDeleteDave