Malcolm Gorrill
Northern News Services

Yellowknife (Apr 21/00) - Subject to regulatory approval, the hourly pension plan at Giant mine may soon be wound up.

Al Kiel, a partner with Morneau Sobeco, explained a wind up means "to terminate the plan and to pay out the benefits and the assets of the plan to the members."

Morneau Sobeco has administered the plan on behalf of Deloitte and Touche Inc. since Miramar purchased Giant mine in December 1999. The mine's former owner, Royal Oak, went bankrupt last year.

"Since the company, Royal Oak, as we know it, no longer exists," Kiel said, "having a pension plan with no corporate entity to administer it or to run it really means we have to look at terminating the plan now."

Morneau Sobeco has submitted a termination report to the Office of the Superintendent of Financial Institutions (OSFI) for approval. Margaret Pearcy is director of communications and public affairs at OSFI.

"None of the assets in the plan can be dispersed until OSFI has approved the report. Normally this process can take anywhere from six months to a year, but ... we're hoping to cut that time well in half," Pearcy said.

"On approval, the plan administrator will purchase annuities for the retired members. These are annuities that are purchased from an insurance company, so it's a lifetime pension for those members who are already retired."

Members who are not yet retired are offered several ways to invest their money, but Pearcy pointed out, "There's no cash that's just handed over to individuals."

The Giant hourly pension plan is underfunded and, since April 1, its benefits have been reduced 25 per cent. Kiel said the exact amount of the shortfall won't be determined until a final valuation is complete, which he said will happen soon.

A statement of claim based on the shortfall was filed with the receiver (Pricewaterhouse Coopers) but there's no guarantee that will necessarily be paid.

Delegates to last weekend's Northern Territories Federation of Labour annual conference contributed $700 to the Pensioners Donation Fund at the Bank of Nova Scotia.