Pension Surplus

Pension Surplus Trial Concludes: Judge's Verdict Expected in Six Months

Following the conclusion of the pension surplus court proceedings, the Association is hoping for an affirmative verdict from Ontario Superior Court Justice de Lobe Panet, who must determine whether or not the federal government misappropriated billions of dollars from the pension plans of public service, RCMP and Canadian Forces employees in 1999.

Testimonies last month placed the pension surplus at $42.7 billion (due to interest and actuarial evaluations); 42.2% of which is estimated by experts to belong to the public service pension account.

Mr. Justice Panet is expected to provide his verdict in the Fall of 2007. In the interim he will evaluate information from 18 days of trial, which involved 10 witnesses and close to 60 exhibits, including the group of 128 internal government documents that he ruled in late 2005 would be admitted into evidence.

The last of the witnesses were recently examined on April 2, then lawyers on both sides completed their respective written submissions. Final arguments began on May 1 and finished within three days.

The Crown’s main arguments were:

  • “no moneys have ever been taken out of the superannuation accounts”
  • there are no real assets in the superannuation accounts
  • the government has not done anything wrong by passing Bill C-78, so there is no real legal issue at stake
  • members of the public service, Canadian Forces and RCMP will receive a pension at the end of their working lives, regardless of the financial situation of the superannuation accounts, so there is no harm done if they do not have access to the surplus.

The plaintiffs’ main arguments were:

  • evidence shows that the government booked the pension funds into the fiscal framework for expenditure
  • the superannuation accounts do have real assets, as indicated by internal reports and provisions in the three concerned superannuation Acts that show Parliament intended the superannuation plans to operate on a full funding basis
  • the pension plan members have an equitable interest in the funds in the superannuation accounts because they contributed to the plans with money from their salaries
  • all pension contributions were placed into designated accounts for the specific and exclusive purpose of providing pension benefits to plan members.

The Association has united with 17 other unions, employee associations and retiree groups, represented by three law firms, in attempt to recover the embezzled pension funds for its members.

2007-05-16T00:00:00

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