After going through months of uncertainty over the future of the Corner Brook Pulp and Paper pension plan nearly two years ago, Gerald Parsons is feeling a little better these days.
Parsons is chair of the Corner Brook Pulp and Paper Union Pensioners Committee.
He said the committee had a meeting at the mill Tuesday afternoon about the state of the plan and updated pensioners during a meeting at the Glynmill Inn later that night.
“Our pension has come a long ways from what it was,” said Parsons on Wednesday.
Two years ago the plan was only funded to 68 per cent and as part of efforts to keep the mill running parent company Kruger Inc. asked pensioners to agree to going from a five-year plan to fund the pension to 10 years.
The idea was the extension would free up capital for the company to invest in the operation to ensure its continued viability.
The pensioners agreed and Parsons said they are now seeing some improvement.
Right now the plan is funded at 83.3 per cent.
“It’s good,” said Parsons, adding it’s great news for retirees who, back in 2012, didn’t know where it was going.
“This is a good news story,” he said, “two years ago it was a bad news story.”
And he’s optimistic things will continue to improve.
Parsons said depending on what happens with the markets, the prediction is that the pension plan will be at 100 per cent in two to two and half years.
He said Kruger is meeting all it’s obligations under the funding plan and making the necessary payments as part of the deal. He noted that once the plan gets to 100 per cent, the 10-year deal is gone and goes back to the original five year one.
Parsons also said that pensioners don’t have to worry that their pension will be gone if the mill were to close.
He said if the mill closes, Deer Lake Power would still be running and because the power plant is part of the pension plan the committee would be looking at arguing that its plan should be maintained.
But if that doesn’t pan out, Parsons said that doesn’t mean the pensions will be lost.
“It don’t work that way,” he said.
“If the mill shuts tomorrow morning and our pension is at 83.3 per cent then they got to buy annuities for us. And whatever the annuity is, that’s what it stands.
“But that will be the second resort for us because the first resort is to find out what’s going on with Deer Lake Power.”
The Corner Brook Pulp and Paper pension plan was set up in 1946 and has 640 retirees on it. Parsons said over $16 million in pensions came into Corner Brook last year alone.