As one of the largest public pension plans in Atlantic Canada, the HRM Pension Plan provides current and future pensions to approximately 9,300 active, retired and deferred pension plan members.

The Province of Nova Scotia is considering changes to pension legislation including funding. The proposed funding regulations maintain the requirement to fund the HRM Pension Plan based on a theoretical bankruptcy scenario for HRM as well as on a Going Concern scenario. If the NS Government designates the HRM Pension Plan to be a Jointly Sponsored Pension Plan (JSPP), plan members and the employer will have to fund 100 percent of Going Concern deficits and at least 80 percent of any Theoretical Bankruptcy deficits each and every year, even if the bankruptcy of HRM is a remote possibility. If the NS Government does not designate the HRM Pension Plan to be a JSPP, then the Plan will have to fund 100 percent of Going Concern deficits and 100 percent of any Theoretical Bankruptcy deficits, each and every year.

The majority of provinces do not require municipal pension plans to fund Theoretical Bankruptcy deficits because it is not a good use of plan member, employer and taxpayer money to fund a remote bankruptcy scenario. The proposed funding regulations will continue to cause great hardship to HRM employees, HRM and the taxpayers of HRM, likely resulting in unnecessary and significant increases in pension contribution rates and/or unnecessary and significant benefit reductions.

The risk of HRM going bankrupt is extremely remote and we question why there is a need to implement these rules for the HRM Pension Plan. We certainly understand the bankruptcy risk associated with corporate pension plans.

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