Morneau Sobeco Appointed Administrator of Canadian Pension Plans

The following was posted on the NRPC web site today.


Thursday, 23 September 2010

We have just received news that the Financial Services Commission of Ontario has appointed Morneau Sobeco as the Administrator for the Nortel Pension Plans to be effective October 1, 2010. Full details of the media release are below for your information. For further information on Morneau Sobeco, you may go to their website at: www.morneausobeco.com. We expect to be meeting with representatives shortly.

The following contact information is provided as to who to contact if you have questions regarding your pension:

More information will be available on October 1st.

Effective October 1, 2010, Morneau Sobeco is the New Plan Administrator for Nortel Pension Plans. On September 30, 2010, pursuant to a court-approved Settlement Agreement reached on March 31, 2010, Nortel Networks Limited (Nortel) will cease to make contributions to its two defined benefit pension plans: the Nortel Networks Negotiated Pension Plan (registration number 587766), and the Nortel Networks Limited Managerial and Non-Negotiated Pension Plan (registration number 342048) (Nortel pension plans). In addition, the agreement recognizes that effective September 30, 2010, Nortel will cease to act as the plan administrator of these plans. Court appointed representatives and counsel to the former Nortel employees and pensioners were parties to the Settlement Agreement.

Effective October 1, 2010, the Superintendent of Financial Services (the Superintendent) appointed Morneau Sobeco Limited Partnership (Morneau Sobeco) as the new plan administrator for the purpose of winding up the Nortel pension plans. The Superintendent made this appointment under the authority of section 71 of the Pension Benefits Act (PBA).

Morneau Sobeco was selected for this appointment through a competitive tendering process.

Why a New Plan Administrator Needs to be Appointed.

Pension plans that are registered in Ontario must be administered in compliance with the PBA, which sets out requirements that must be followed for the operation, funding and termination of pension plans in Ontario.

Effective October 1, 2010, the newly appointed plan administrator is needed to ensure continuity in the administration of the Nortel pension plans (including payment of pension benefits), to commence the wind up of the Nortel pension plans, and to represent the pension plans as decisions are made regarding allocation of the proceeds from the sale of Nortel’s assets.

In carrying out the wind up of the Nortel pension plans, the administrator will be responsible for determining adjusted entitlements, including the “top up” provided through the Pension Benefits Guarantee Fund (PBGF) to entitlements earned in Ontario. A retiree’s entitlement with the PBGF “top up” is determined as of the date the plan winds up. The fact that it may take years to annuitize the Nortel pension plans has no impact on the pensions of Ontario retirees, as the Ontario government through the PBGF assumes the risk for any changes in the annuity markets.

Who to Contact for Pension Inquiries

Pension plan members and pensioners with questions about their entitlements and benefits should contact the plan administrator, as the Financial Services Commission of Ontario (FSCO) does not keep personal data and is not able to respond to such questions.

Effective October 1, 2010, questions should be directed to the new plan administrator, Morneau Sobeco Limited Partnership at www.morneausobeco.com. (More information will be available on October 1st.)

Prior to October 1, 2010, questions concerning the Nortel pension plans should be directed to the current Nortel pension plan administrator at:

Nortel Networks Limited
5945 Airport Road, Suite 360
Mississauga ON L4V 1R9
Tel: (905) 863-7462