News Release: Making DB plans more attractive
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HOOPP supports recommendations to make defined benefit plans more attractive to employers

Survey shows two-thirds of Ontarians worried about having enough money to retire

TORONTO (January 20, 2009): The Healthcare of Ontario Pension Plan (HOOPP) announced its support for the recommendations of the Ontario Expert Commission on Pensions in encouraging the Ontario Government to make secure pension plans more attractive to employers.

"We were very encouraged by the findings of Dr. Arthurs' expert commission on pensions. We agree that it should be easier for people to change their jobs and keep their pension benefits whole. The unique structure of multi-employer pension plans, where the administrator is not the employer, deserve more specialized pension rules. We'll work with government on any changes to the legislation," said John Crocker, President and CEO of HOOPP, speaking at a symposium on January 20th about the economy and defined benefit pension plans. "In today's volatile economy, plans like HOOPP provide a safe harbour for the retirement savings of Ontario workers – a secure, reliable pension that will provide them with meaningful income in retirement."

A 60-year-old nurse with 30 years experience can retire with a HOOPP pension of $50,000 per year for life, plus survivor pension and inflation protection. "It takes $1 million in savings to provide a pension of $50,000 per year. The average Canadian currently has $60,000 in RRSP savings. It's clear that a gap exists – one that can be addressed by defined benefit plans like HOOPP," said Crocker.

HOOPP also released some key findings from a recent survey conducted by the Gandalf Group that highlighted five key areas of concern among Ontarians:

  • Two-thirds of respondents say they are worried about having enough money for retirement
  • Three-quarters of retirees say their financial situation has worsened over the last year
  • Ontarians with a household income of less than $50,000 are 10 times more likely than households with incomes over $150,000 to have put no money away for retirement
  • 73 per cent of Ontarians said a defined benefit plan would be important in choosing one job over another
  • There has been a sea change in the type of plans offered to employees. According to the survey, 50 per cent of respondents over the age of 55 say they have a defined benefit plan. Under the age of 45, only 25 per cent say they have this type of retirement plan

Defined benefit plans play a strong role in the Ontario economy:

  • HOOPP pays out nearly $1 billion in pension benefits each year to healthcare workers – a strong boost for the Ontario economy. HOOPP, Teachers and OMERS, the three largest pension plans in Ontario, pay out stable pension income of $7 billion per year into the Ontario economy
  • HOOPP manages $30 billion in assets to secure the pension promise for members. Together with OMERS and Teachers, the three plans have $200 billion invested to support Ontario pension plan members

About HOOPP

HOOPP is the pension plan of choice for Ontario's healthcare sector with over 300 participating employers and more than 250,000 plan members and retirees. HOOPP pays more than $1 billion per year in pension benefits, providing security and peace of mind to thousands of retired healthcare workers.

HOOPP was created in 1960 and is now administered by a successful partnership of employers and representative unions. It is governed by a Board of Trustees with representation from the Ontario Hospital Association (OHA) and four unions: the Ontario Nurses Association (ONA), the Canadian Union of Public Employees (CUPE), the Ontario Public Service Employees' Union (OPSEU) and the Service Employees International Union (SEIU).

For further information or to arrange interviews, please contact:

Martin Biefer
Director, Marketing Communications
Phone 416 369-8045