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01-04-2013, 10:46 AM
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Originally Posted by hizzoner View Post
While we speculate as to what the obstacles are to a new cba I just saw on Score Sports that the union is now asking for a defined benefit pension plan. My understanding was that the union had a pension fund primarily paid into by the owners and that there were negotiations to increase the fund. This is the first I heard of a defined benefit plan with guarantees by the owners as to benefits on retirement--that is the owners pick up the tab if the fund--not run by the owners does not generate enough revenue to pay the defined benefit--whatever that is. NO ONE is going there anymore--the huge stock market swings have killed many big businesses who had agreed to do this. Basically only government does this now--with predictable results. Is this another Fehr ploy - a poison pill to sabotage talks or something else?
Pensions are not inherently bad. The problem with many public sector pensions programs is that the actuarial assumptions relied upon by employers were/are ridiculous. For instance, in California, there was an assumption that the pension pool would earn close to 10% per year going forward. That's an absurd assumption. Companies/municipalities who use better assumptions rarely have problems.

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