Marilyn hopes life will become a little easier when the Pension Benefits Standards Act (Bill 38) becomes law. But until the B.C. Legislature reconvenes in the fall, the Comox resident needs to make do with a one-time withdrawal maximum of $9,000 from a locked-in retirement fund.
Marilyn, who requested the Record not use her last name, is off work due to hip surgery. She has a life investment fund (LIF) from the Children’s Hospital in Vancouver, where she worked 20-plus years. Her 70-year-old husband Ken has a small pension.
Accessing her savings would reduce financial stress and provide freedom to choose the direction she desires with her family in her retirement years.
“It’s not just me. It’s province-wide,” said Marilyn, who has undergone two hip replacement surgeries. “Speak to anyone who has been in any kind of union position, and who has a locked-in fund, they’re all in the same boat.”
As of age 55, she is entitled to $9,000 once a year but cannot withdraw further funds a second time. But even when she reaches 65, Marilyn will only be able to access a portion of her money. She would like to have at least another $1,000 per month to live.
“It’s our money,” Marilyn said. “We should be able to spend it as we see fit, because we are all adults.”
She met Friday in Courtenay with staff from the B.C. Ombudsperson Office, which can investigate complaints about ministries and boards, among other bodies.
A modernized Bill 38 was passed and received royal assent in 2012. But the rules and regulations, which include hardship clauses for seniors and pensioners, still need to be written. Alberta and B.C. are to harmonize their rules based upon the Ontario model. The Alberta model allows LIF withdrawals up to 50 per cent.
Recently, the Province also passed a Pension Benefits Standards Amendment Act (Bill 10) that corrects a number of technical issues and omissions found in the 2012 modernized act. However, the new act cannot come into force until regulations are developed and approved by Cabinet.
“The new act does provide legislative authority for regulations that would permit the unlocking of funds that were transferred from pension plans,” says Glen Plummer, senior communications officer. “The government has indicated publicly that unlocking of funds will be permitted only in limited circumstances, including financial hardship. This is to ensure pension funds are used for their intended purpose, to provide pension plan members with a source of retirement income.”
Finalizing regulations is a high priority for the Ministry of Finance, Plummer added.
Government expects to have a fully developed set of new regulations available for Cabinet review sometime this year.