The University of Winnipeg must pay $8.8 million to a large number of currently retired employees. They agreed to share a surplus in 1999, but the surplus was wiped out in the market crash after 9/11. The courts have ruled that uWinnipeg still has to pay those retirees.
To do this, uWinnipeg is taking out a 40-year loan that will end up costing $24 million once its paid off. Read the story.
An interesting situation… This new pension cost will be $600,000 per year (for 40 years), on top of the usual pension costs. For a university that is already cash strapped, could lay-offs of employees result? Could quality of education and research suffer? uWinnipeg wasn’t arguing against paying retirees’ pension, just not giving them additional money from a surplus that no longer exists.
I’m no pension expert, nor do I know anymore details than the article gives, so who am I to comment or make a judgement. I just find the situation interesting.