November 22, 2012
Postmedia Network Inc. is asking current and former employees to help the embattled newspaper publisher save some millions of dollars a year by extending the amount of time the company has to top up their pension fund.
The company – which publishes such metropolitan titles such as the National Post, Ottawa Citizen and Calgary Herald – is taking advantage of rules that were quietly implemented Nov. 1 in Ontario that allow companies incorporated in the province to fully fund their pension shortfalls in 10 years rather than five.
The changes are intended to help stave off a national pension crisis. A survey by consultant group AON PLC found 97 per cent of defined-benefit pension plans in Canada have solvency deficits. The average plan would be able to pay only 70 cents on the dollar if it were forced to meet all its obligations today.
"Companies want to pay the minimum now and worry about the rest later," said Mitch Frazer. "They’d much rather put money in when times are good and hope for better interest rates down the road."
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