Company supports the federal Department of Finance initiative to extend
the flexibility of pension options available to Canadians through
proposed Target Benefit Plans
TORONTO, June 23, 2014 /CNW/ - Morneau Shepell (TSX: MSI), the largest
company in Canada offering human resources consulting and outsourcing
services, today announced that it has responded with recommendations
and its views on the proposed Target Benefit Plan (TBP) framework
outlined in the Department of Finance's consultation paper. The
consultation document, which was provided to serve as a focus for the
consultations, outlines background information and illustrates the
parameters of the proposed TBP framework.
The consultation process followed an announcement on April 24, 2014 by
the Government of Canada that launched a national discussion of
proposed new TBPs that would share risks between employers and
employees. The suggested TBP framework is designed to help ensure that
effective, sustainable pension options are available to Canadians who
work in the federally regulated private sector or Crown corporations.
"The long-term sustainability of the traditional defined benefit plan is
questionable and yet defined contribution plans, the only real
alternative until recently, have their own drawbacks," said Fred
Vettese, Morneau Shepell's Chief Actuary. "The time has come for a new
hybrid vehicle that shares risk between employers and employees in a
more sustainable manner, while preserving some of the more attractive
features of defined benefit plans. In our opinion, target benefit
plans are very promising in this respect."
In its response, Morneau Shepell stressed that all groups should
collaborate to ensure a smooth transition. "We strongly believe that
there should be a realistic pathway to conversion to a TBP," added
Vettese. "The voluntary nature of the proposed framework means that all
stakeholders should have a chance to learn more about TBPs and have an
opportunity to express their views. It will be vital for government,
unions, business, plan sponsors and plan members to focus on
cooperation in order to achieve a sustainable system to fund pensions
"We agree with much of the approach the Department of Finance is
suggesting in its consultation paper regarding target benefit plans,"
said Mel Bartlett, Managing Partner for Morneau Shepell's Atlantic
office. "Our response today provides recommendations aimed at shifting
the focus to sustainable solutions such as TBPs that provide plan
members with adequate, predictable pensions. Our position is based on
our extensive experience in working with a wide range of pension plans
and their stakeholders, as well as our involvement in helping to
develop the shared risk pension plan model in New Brunswick."
Morneau Shepell assisted in the development of New Brunswick's Shared
Risk Pension Plan design in 2012. The company is now working with a
number of other pension plans in New Brunswick that have adopted the
Shared Risk Pension Plan model, plus several others that are
considering the change.
About Morneau Shepell Inc.
Morneau Shepell is the largest company in Canada offering human
resources consulting and outsourcing services. The Company is the
leading provider of Employee and Family Assistance Programs, as well as
the largest administrator of retirement and benefits plans and the
largest provider of integrated absence management solutions in Canada.
Through health and productivity, administrative, and retirement
solutions, Morneau Shepell helps clients reduce costs, increase
employee productivity, and improve their competitive position.
Established in 1966, Morneau Shepell serves more than 21,000 clients,
ranging from small businesses to some of the largest corporations and
associations in North America. With approximately 3,300 employees in
offices across North America, Morneau Shepell provides services to
organizations across Canada, in the United States, and around the
globe. Morneau Shepell is a publicly-traded company on the Toronto
Stock Exchange (TSX: MSI). For more information, visit morneaushepell.com.
SOURCE: Morneau Shepell Inc.
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