Surplus Update
(e-mail sent to McMaster Community on October 9, 2002)

This is an update on the surplus distribution proceedings.

The Financial Services Commission of Ontario (FSCO) has had to reissue its "notice of proposal" as a consequence of some deemed significant factual errors that appeared in the first version of the notice.  The notice is now dated September 27, 2002 and this means that the 45 day period (which would generally be the earliest possible date for final approval) runs until the 12th of November.  Allowing time for processing means that the target  date for cash transfers and check mailings would be in the last week of November while the target date for RRSP transfers would be the first week of December.

Unfortunately, such forecasts depend on timely approvals and on there being no appeals that delay matters further.  It has come to our
attention that an appeal has been filed with FSCO.  This will generate additional delays while the Financial Services tribunal decides whether to hear the appeal and further delay if the appeal is allowed to go to a
full hearing.  Rest assured that both McMaster and the Plan Members'
Committee will aggressively oppose any such appeals to ensure payment as soon as possible.

While we have not seen the written appeal that has been filed, it is our
understanding that the appeal may be on the same basis as a previous request to the courts a year ago;  someone who left the plan prior to July 1, 2000 and took their money with them may now be seeking to be part of the surplus sharing group.  If this is so, we will argue before the Financial Services Tribunal that the appeal is frivolous and manifestly unfounded since these issues were already dealt with and resolved by the court.  The appeal will
simply delay matters and cost additional resources.  We shall take the position that such costs should not be borne by our pension plan and consequently we will be asking the tribunal to order that the appellant be made to pay the Committee's and the University's costs in opposing the appeal.  These costs could easily run to over $20,000.

On another matter, we have had to make a few changes to the Pension Plan Text to satisfy Canada Customs and Revenue Agency (CCRA).  Most of these have no substantive impact on individuals.  However one of them, concerning the buy-back of service with another employer for periods prior to 1991, will negatively affect a few dozen individuals.  The affected individuals will be personally notified.

On the buy-back of service generally, individuals who have already requested buy-back will be informed by the plan's actuaries of the exact cost of their buy-back by the end of October (if there are no further
glitches) to assist with their individual planning.  Everyone will get a statement from CIBC Mellon to indicate the amounts transferred to them or to their RRSP once all the payouts are completed.

Even though transfers may be by direct deposit, this notification will be by regular mail so if you have recently moved, you should inform human resources of your new address (by e-mail to surplus@mcmaster.ca or by the surplus hotline at extension 24272).

We will keep you all informed as the situation further develops.
 
 

Les Robb for the Employee Groups
Simon Ouellet for the University