Nfld. & Labrador

Government cuts $20M from MUN pension plan

For the second time in less than a month, Memorial University has received a financial blow.
Minister Darin King, speaking on behalf of Advanced Education Minister Clyde Jackman, says government has contributed more than $120-million to Memorial University's pension plan since 2005. (CBC)

For the second time in less than a month, Memorial University has received a financial blow.

The Newfoundland and Labrador government will not make a $20-million contribution to assist MUN with its pension obligations. 

The money would have helped shore up the university's pension fund for the long-term. 

In early May, as part of government's 2015 budget, Memorial was informed of a $20-million cut to its operating grant.  

In the House of Assembly on Thursday, Justice and Public Safety Minister Darin King spoke on behalf of Advanced Education Minister Clyde Jackman, who is out of the country.

King told the legislature that it's "not about kicking the problem down the road."

"It is about taking the challenges head-on this year and recognizing that there is a $20-million problem to solve," he said.  

"If we wanted to play politics, we could simply pay the money this year, get through an election, and then break the news to them that there is a $20-million problem."

King said there were "significant discussions" about trying to right-size the budget of Memorial University.

"These are challenging times and in this particular case, the pension plan of Memorial belongs to Memorial and its employees," he said.

"And we felt that at this point in time, given the budget predicament we're in, it's not fair to put that on [the] backs of the taxpayers of the province."

The provincial government has contributed more than $120 million to Memorial University's pension plan since 2005. 

It is currently 90 per cent funded.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.