233050


Call to protect pensions

A report by the Canadian Centre for Policy Alternatives recommends that payments to shareholders such as dividends and share buybacks by companies should be limited if their pension plans are underfunded.

The report says pension regulations must expand to consider broader financial decisions within companies.

It says that in many instances, firms are complying with the minimum required payments under the rules, but they are not making up the shortfalls in the pension plans as fast as they could.

Companies with defined-benefit pension plans have been hurt by the financial crisis and low interest rates, which have increased the amount of money they are required to have in their pension plans to pay future benefits.

When a pension plan is not fully funded, members face the possibility of seeing their pensions reduced if the plan is forced to wind up.

The report noted that the pension plan at Sears Canada has a $267-million shortfall, but the retailer which is in the process of liquidating has paid $1.5 billion in shareholders in dividends and share buybacks since 2010.



More Business News



226943
227682
Data from CryptoCompare
RECENT STORIES
227125
232059
Castanet Proud Member of RTNDA Canada
Press Room
231274