Pension plans are secure, says committee chair

The board of trustees and the pension committee of General Synod assured the Council of General Synod (CoGS) that the global economic downturn has not affected the payment of pensions to retirees since the pension fund has guidelines and constraints “designed specifically to reduce the overall level of investment risk.”Bishop Philip Poole, chair of the pension committee of the Anglican Church of Canada, did acknowledge that, “if we needed the money now it would be a problem,” but “we’re in it for the long haul.” He said that the board and committee “have every confidence that the long-term objectives of the plan will be met.”In a letter sent Oct. 18 to members of the pension plan, Bishop Poole said that they would be consulted in the event that the situation worsens. “In the longer term, benefits must be supported by overall investment returns and if these long-term investment returns are weaker than anticipated, action may need to be taken,” he wrote. “Be assured that, if any future action would cause changes in either contribution or benefit levels, you would be given plenty of notice.”The market value of the fund as of Sept. 30, 2008 was $553 million, the pension committee said in a written report to CoGS. “The return for the third quarter 2008 was -8.6 per cent compared to the benchmark of -7.9 per cent,” the report said. “For a four year period ending September 30, 2008, the total fund return was 5.9 per cent compared to the benchmark of 5.3 per cent.”Last year, the fund’s market value, as of Dec. 31, was $644.7 million and return on investment for a four-year period ending that year was 10.5 per cent.The committee also reported that the house of bishops has given the committee approval to conduct a feasibility study on the possibility of merging the General Synod Pension Plan (GSPP) and the Lay Retirement Plan (LRP). Bishop Poole and Judy Robinson, executive director of the Pension Office Corp., met with the house of bishops at its fall meeting and advised bishops that “the church was not being a responsible employer by offering two different types of pension plans to different groups of employees.” The GSPP is a specified multi-employer plan where participating employers include dioceses and other church-related organizations. The LRP is a defined contribution plan where participating employers include parishes and church-related organizations.”These two groups are not treated in the same way,” the committee said. It noted that the concept of a merger had been raised at the diocesan finance officers’ conference in June 2008 but that it had not been met with a positive reaction.”It was suggested that there is a different level of commitment to the church by the people employed at the parish level; their financial needs are different and parishes cannot afford a 5 per cent increase in pension contribution,” the committee report said. “Rather than some employees/parishes withdrawing if a new plan were not affordable, it would be better to have them continue in the LRP.”The committee said that the pension trustees would continue to pursue the matter with the house of bishops “and have a conversation with the different groups which participate in the LRP first and get their reaction about a possible contribution increase.”