Unlocking a locked-in Pension (RRSP)

September 30th, 2007, 10:40 AM

Hi Lester:

Yes in Alberta You are able to unlock 50%. If you transfer it into a RRIF and just take it out gradually as You need some ,you would pay a lot less tax. If you take out a large sum. Yes you are going to pat through the nose.
The reason of having these funds unlocked is for emergencies more then anything.

Regards Bill C

September 30th, 2007, 10:41 AM

Hi All; Rick Bartolucci took a cheep shot in the Sudbury Debate and this is a comment to Mr. Bartolucci.


Mr. Bartolucci in his shameful attempt to discredit his inexperienced opposition, cites the fact that Mr. Hampton, while disrespectfully referring to him as "Howie Hampton", received a $550, 000 pension buyout, hypocritically fails to include the 20 members of his own Liberal party who also received amounts far in excess of the $550, 000 collected by Mr. Hampton.

That's right! Twenty members of his own party, including McGuinty, Sorbara, Conway, Bradley, Ramsey etc... all received the same or similar amounts!

With that shot Mr. Bartolucci, you have reached the all-time zenith of hypocrisy.

It's too bad your opponents didn't know anything about it, otherwise I'm sure you would have kept your little secret to yourself as you've done now for the last eight years.What a shameful cheap shot!

Talk about the pot calling the kettle black.

Mr. Bartolucci, besides being pompous in his attitude towards his opponents and his constituents, in his usual style fails to "tell the truth - the whole truth..." and include his own party members as recipients of this gross amount of taxpayers money.

Yes taxpayers money as well, because in order for all of them to get their pension buyouts, including his own Liberal brethren, the taxpayers of Ontario had to pay the 10 to 20 million dollar shortfall for the buyout to be completed.

Further he also fails to inform you all that this special unprecedented buyout was only created by the government for 61 MPP's while all other Ontarians were left out of this special little privilege.

That's right, the Liberals, including Mr. Bartolucci, so very eloquent in opposition to this financial largesse, have done nothing to include the rest of all Ontarians in this exclusive unfettered benefit.

That's right again, 61 MPP's amongst us are walking around quietly with full access to their pensions while the million other Ontarians with the same types of pension assets are struggling year after year with a mere 6.5% access!

So yes, Rick, why don't you you tell the public the truth - the whole truth and then maybe you won't be so smug when the audience and the public hears how much of a hypocrite you are.

Regards,Grant Fleury, SudburyOntario

Coalition of Independent LIF Holderslocked_pensions_gf@yaho o.ca

September 30th, 2007, 05:00 PM

Media Conference Summary
Good afternoon,

Wednesday, September the 26th in Toronto at the CARP headquarters, a
media conference took place that included notable financial economics
experts Jack Mintz and Malcolm Hamilton, Bill Gleberzon of CARP,
members of our Ontario Coalition of Independent LIF Holders, reporters
from various media organizations and other interested parties.

Bill Gleberzon of CARP, head of CARP's campaign to unlock pensions,
hosted the event and presented a comprehensive summary of the locked-in
pensions, the 61 MPP's with full 100% access, the invited speakers and
the current status of the political parties position.

A number of items relating to the unlocking of pensions in our province
and various rationale for unlocking locked-in pensions was discussed at
length by the participants.

A message of support for unlocking locked-in pensions, written by
renowned financial expert Gordon Pape (although unable to attend), was
read on his behalf.

Our two attending Coalition members, Bill Nafziger and Philip James,
gave examples of the hardships and limitations affecting them as a
direct result of holding one of these restrictive locked-in pensions as
well as a number of other stories of hardships being encountered by
Ontario residents that are currently in possession of locked-in
pensions.

They were very well received and as a direct result, one of their
stories is featured in today's TheStar.com. The article can be accessed
on the internet at;
http://www.thestar.com/News/article/260918

Another article has also been written today in the Financial Post by
Jonathan Chevreau under the banner "The Wealthy Boomer" based on an
interview with Malcolm Hamilton and can be accessed at;
http://communities.canada.com/financ...-pensions.aspx

Philip James read our Coalition statement that I wrote on behalf of the
members of our Coalition. It can be found on the internet using google
and searching for "Coalition of Independent LIF Holders".

We are encouraging every Ontarian who is currently in possession of a
LIRA, LIF or LRIF, (essentially a form of a locked-in pension) to lobby
your MPP and the candidates in your local riding to unlock all
"locked-in" pensions 100% thus allowing you to decide for yourself how
to manage your own pension money. Remember this is not government money
- it's yours - 100% of it. You must demand to have the same right to
manage it as you see fit, as was created for 61 MPP's by MPP's in
1999. Yes, they already have 100% access to their former "wound-up"
pension through an amendment to provincial legislation they exclusively
created for themselves in December of 1999. All other Ontarians do not
have this privilege!

We are also encouraging every Ontarian who is currently receiving some
form of pension benefit from your employer to take heed of the future
limitations you will face if you are forced to have your company
pension benefit transferred to a "locked-in" retirement account due to
layoff, termination, company closure or similar event that creates such
an occurrence.
Although this may not be on the minds of the younger workforce since
retirement is far into the future, changing the legislation to have
these "locked-in" retirement accounts (LIRA's) unlocked at age 55 is as
equally important for the younger workforce as it is for those who are
currently at the qualified retirement age (usually 55), since they too
will one day be in a similar position once they reach retirement age.

The campaign to have these pensions unlocked for those now with LIF's
and LRIF's (created from the aforementioned LIRA's) today is extremely
important as it greatly affects the quality of retirement they will
have if access to their locked-in pension is increased to 100% as 61
MPP's in 1999 did for themselves.

Yes, there are 61 elite Ontarians amongst us that enjoy a benefit that
is not available to you!

The Liberals have introduced a one time 25% unlock option in January of
2008 in an attempt to appease the holders of locked-in pensions. We
believe this to be a hypocritical insult to all Ontarians while twenty
of Premiere McGuinty's Liberals, past and present, continue to enjoy
100% access for themselves! They continue to support this hypocrisy by
allowing two acts to exist, with dramatically different access
provisions, governing the exact same type of pension derived assets.
One act (MPP Pension Benefits Act) governing and granting themselves
100% access and the other act (Ontario Pension Benefits Act) governing
the rest of all other Ontarians allowing a paltry 6.5% yearly access!

The NDP, although as of today quiet on this issue in their campaign,
had introduced a bill (Bill 175) in December of 2006 to unlock pensions
100% as well.

The PC's are the only party to date that have publicly committed to
100% unlocking since their July 5th public announcement and continue to
highlight this in their campaign, if elected.

Saskatchewan, in 2002, became a leader in respecting the rights of
their residents to manage their own pension money and unlocked all
locked-in pensions for ALL their residents, not just their provincial
politicians. Ontario stubbornly continues on with their repressive,
regressive and discriminatory policies pertaining to locked-in pensions
for all Ontarians, with the exception of the 61 MPP's of 1999.

We encourage you to exercise your rights and let your voice be heard in
the upcoming provincial election and vote for the party that will
unlock locked-in pensions 100% as was done for the 61 MPP's in 1999.

Our Coalition will accept nothing less than 100% unlocking, as was done
in Saskatchewan, and parity with our own 61 MPP's of 1999!

Thank you,
Grant Fleury
Ontario Coalition of Independent LIF Holders

October 1st, 2007, 08:11 PM

A FREE VOTE

Hi All; This is a letter I just received.
Regards Bill C

There has been a lot of discussion in the media and by the other political parties about bringing faith-based schools into the public education system. The John Tory campaign wanted to make sure you were aware of additional details John Tory provided today on this issue as part of his speech to the Economic Club of Toronto.

In John’s own words,“If I have the privilege of serving as Premier, I will strike a commission, consult with the public, create pilot projects, and place a bill before the [Ontario] Legislature. But that bill will only proceed with the support of the people, through their elected representatives. MPPs will be allowed a free vote, so they are at liberty to vote their conscience and represent the wishes of their constituents. In this significant way, the public can be more involved in the decision making.”

To be clear:

John Tory is allowing all of his MPPs to have a free vote in the Legislature on this issue when it comes before them in two – three years.
This means that they will all be able to vote based on their own conscience and the wishes of their constituents.
In the meantime, over the next year or so, a commission to study the issue will be conducted.
Then, appropriate pilot projects will be conducted. Then, a committee of the Legislature will review and study the work of the commission.
And, after that two – three year process, members of the Legislature will have a free vote so they can reflect the wishes of their constituents.
John Tory will vote for it, but, PC MPPs will be free to vote as they see fit.

John Tory has been open and honest about his views and the motivation behind them. He has been clear today, before the election, that there will be a free vote for MPPs and he has always had the same position in public as he has had in private on this issue.

John Tory continues to be the only provincial party leader offering real leadership for Ontario. Through strengthening and modernizing health care, getting rid of ‘catch and release’ justice, providing real assistance for our farmers, eliminating Dalton McGuinty’s regressive health tax, and helping our most vulnerable citizens, only John Tory has a vision and plan for a strong, inclusive and economically prosperous Ontario.

October 2nd, 2007, 03:53 PM

Hi All I received this letter from a concerned Citizen who would like to encourage all people to read Linda Leatherdales Article of which I will post next Regards Bill C

From: John Hoell
To: torsun.editor@sunmedia.ca
Sent: Saturday, September 29, 2007 10:32 PM
Subject: Re-Retirees want their money

In regards to Linda leatherdale's column Friday Sept.28-Retirees want their money,I urge all Ontarians to read and understand her story.I signed that petition 6 months ago after doing some serious investigating and was almost sick to my stomach.In my opinion this trash that calls themselves the liberal party of Ontario must be voted out of office on October 10 and preferably into jail where most of them belong.They are treating our seniors with complete disrespect and just plain arrogance.If every taxpayer knew the facts (as this situation of these controversial locked-in pensions could very well apply to them and endanger their financial well being when they retire) I am sure without doubt that they would vote these bums out come Oct.10.This is disgusting the way our seniors who worked hard during their lives to be treated this way.I personally have sent numerous emails to the liberals to explain themselves and what they intend to do to fix this mess but I did not receive one reply,which I figured anyways.I know one thing absolutely for sure and that is on Oct.10 my vote will not be for these incompetent liberals and I urge everyone to go out and exercise their right to vote.
J.Hoell
Barrie

October 3rd, 2007, 09:34 AM

Hi This is a Great article that Linda Leatherdale wrote.

http://money.canoe.ca/Columnists/Leatherdale/2007/09/28/4533775-sun.html

Any wise politician knows this: Don't tick off the blue-rinse crowd.

Well, this powerful voter group is ticked off. Skyrocketing property taxes have them seeing red. So do gouging electricity bills that Queen's Park hit with a debt retirement tax, plus GST. And they're angry about a clampdown on their precious income trusts, thanks to the feds.

But here's an issue that really has them riled. Not allowing them access to their locked-in pension money. Their anger hits meltdown when they recall how MPPs were allowed total access to their pension money in 1999, when some $54 million was withdrawn from the old pension scheme, then topped up with $55 million from general revenues, for a total of $109 million funnelled into MPP RRSP accounts.

"It's disgusting how elected officials have this ongoing trend of continually taking care of themselves, while totally ignoring the rest of the electorate," writes Eva Cherwinski, one of thousands who've signed a petition demanding access to locked-in funds.

Here's how Ontario's pension laws work. Let's say you're 48, and you get the boot out the corporate door. Any money accrued in your company pension plan would be moved into a Locked-In Retirement Account (LIRA), and you're not allowed to touch the money until you're 55.
Problem is access is very limited, like only 6.7%. The older you get, the more money you can get at -- but not until age 90 can you take all your money.

James Law accuses Queen's Park of being "cruel."

He wrote that five years ago his mother was diagnosed with cancer and his father, then 68, had a sizable amount of money in a locked-in pension. His parents wanted to travel and enjoy the money while they could, but his father was denied access to the funds. His mother died two years later, and now his dad is gone, too.

"We, his children, did not want their money," Law said.

Recent changes to pension laws allow people facing financial hardships to get at the money. Also, you're allowed access if a doctor certifies you have less than two years to live.

In the past, regulators voiced concern if people had access they could blow the money and become dependent on low-income government programs. Others worried benefits, like the GST credit and old age credits, could be jeopardized, plus investors would miss out on extra value in vested pensions.

But Malcolm Hamilton, a pension expert with Mercer Consulting, says their worries are misguided. "Personally, I don't see (why) the protection is needed," he said, pointing out investors have access to their RRSP money and there is no evidence of irresponsibility.

CONVERT OR CASH OUT

RRSP funds grow tax free up to age 71, when you must either convert to a RRIF or an annuity, or cash out. Cash out early and you pay tax at your income tax rate.

The bottom line is Saskatchewan already allows 100% access to those 55 or older, Manitoba is soon to do the same, Alberta allows 50% at age 50, and New Brunswick 25%.

It's estimated one million Canadians have locked-in pension money, with 450,000 of them in Ontario.

"Why begrudge Ontarians the same right?" asks Bill Gleberzon, director of government relations with Canada's Association for the 50 Plus (CARP).

With only 12 days to the Oct. 10 Ontario election, the CARP, along with the Ontario Coalition of Independent Locked-In Fund Holders, is making this a political hot potato. This week, they went to Queen's Park to demand changes that would see those aged 55 be allowed to access 50% of locked-in funds, and at 65, 100%.

CARP has Conservative leader John Tory's support. He promises 100% access.

NDP leader Howard Hampton is also committed. In December 2006, NDP MPP Andrea Horwath tabled a private's members bill that would unlock funds.

With the heat on, Fiberal leader Dalton McGuinty was forced to introduce legislation to take effect in January 2008, that would allow people to transfer their current locked-in fund into a new locked-in fund, and be able to access 25% of the money within 60 days.

"Miss the 60 days, and you're out of luck," said CARP's Gleberzon.

Wanna fight back?

Go to www.petitiononline.com/WRC101/petition.html.

As Patricia Reeves argues, "It's our money, not yours!"

October 6th, 2007, 10:02 AM

Hi All ; This is a letter Ken sent to a Liberal MPP.

Good morning Mr. Kwinter,

Like your Liberal colleagues, both past and present ... Mr. Michael Brown, Mr. Michael Bryant, Mr. Sean Conway, Ms Caroline DiCocco, Mr. Bruce Crozier, Mr. John Gerretsen, Mr. Dalton McGuinty, and the list goes on ... you clearly understood the incongruity of Bill 27.

Your words from the Hansard for Thursday, December 9, 1999 are ...

" I haven't quite come to terms as to why there is a special provision for MPPs. What is the intent? I don't understand that.......... Why are we now singling out MPPs, and not only MPPs but a very small number who could have access to this provision?

In fact on that same day you went to great lengths to tell the Legislature that as a former Minister of Financial Institutions in 1986, you had introduced Bill 170, an Act to revise the Pension Benefits Act.

You said concerning Bill 170 ... "I would caution the members on the opposite side and the minister and the people in the ministry to make sure they have a coherent, clear rationale for why this is being done, particularly when you take a look at Bill 170, the bill I introduced on December 9, 1986, where there was absolutely no mention of MPPs, no mention of any particular group other than pensioners. It was totally universal across the whole field of pensions."

I have been asking you for some time ... are you a man of integrity . are you going to tell Ontarians the REAL and WHOLE truth behind Bill 27 . given that Mr. Bradley, Mr. Conway and 18 others from your Liberal party received totally unfettered, unlocked pensions ... pensions that had been previously locked-in ... and ... despite many members of your own party, including yourself, speaking strongly against such exclusive privilege . they accepted their unlocked pensions anyway.

As you are well aware, this same extraordinary financial privilege has never been extended to any other Ontarian.

Your recent offering of a one-time, 25% unlocking privilege of principal . full unlocking being available at age 90 ... is a cruel and vicious joke against Ontarians ... when compared to what Mr. Bradley and Mr. Conway received!

Does the word HONOURABLE before your name compel you to tell ALL the truth ALL of the time ... or does it simply mean an enhanced pay cheque ... a pay cheque that is paid in part by seniors who own locked-in pensions and who must submit to the vulgar restrictions imposed on their pensions by the Financial Services Commission of Ontario.?

Are you or are you not going to tell the WHOLE truth? You have been in power since 2003 and as such, have had ample opportunity to do so!

I again await your answer,

Kenneth Elliot

October 8th, 2007, 10:08 AM

Hi All; This part of the fight is just about over, the story will be told on Wednesday.
If the Liberals get in We will have a hard fight to try and have these pensions unlocked 100%

Anybody that wants these pensions unlocked had best get out and Vote for either the PC or NDP party because if not. Who Knows!!

Here is a letter I sent out to some papers in NW Ontario recently and some of my thoughts below it

Regards Bill Costello

Unlock pensions

Bill Costello
Wednesday, October 3, 2007 Dear editor:

An open letter to local Liberal candidate Mike Wood.


Why is it, when asked the question to all members if they would unlock locked-in pensions at the all-candidates’ debate on Kenora TV, that you immediately attacked Howard Hampton and his wife for having their pensions unlocked 100 percent when they retire at the age of 55 or their earlier retirement date.

Why didn’t you also state that 20 of your own party members also had their pensions unlocked—and many of them for a lot more money than Howard and his wife will receive when they retire.

We don’t begrudge the MPP's for having their pensions unlocked. This is the sensible thing to do.

We do, however, begrudge the fact that even though the Liberal leader spoke out in the legislature against it being done for the 61 special MPP's (including himself), that it was not fair because it was not done for the rest of the citizens in Ontario.

He now refuses to do it for the working people and seniors of Ontario.

Why is it that the Liberal party now only offers to unlock these pensions 25 percent and the remainder at 90 years of age? An age when most of the people already will have died!

Why is it that the Liberal party refuses to unlock 100 percent when the NDP and the Progressive Conservatives, plus C.A.R.P. (the organization for 50-plus) and experts in the field of pensions, such as Gordon Pape, Jack Mintz, and Malcolm Hamilton, all agree that these pensions should be unlocked 100 percent for the citizens of Ontario at their retirement age, as it was done for the citizens of Saskatchewan in 2002.

Why is it the Liberal party refuses to do the right thing? Especially considering that it would not cost the taxpayer one cent and also would improve the economy.

Why is it the Liberal party refuses, after being lobbied for two years, to do the honourable thing and unlock these pensions.

(Signed),
Bill Costello
Atikokan, Ont.
Editor’s note: Bill Costello is with the Ontario Coalition of Independent Locked-in Fund Holders

October 8th, 2007, 10:28 AM

Hi All This is a note to a question I was asked. ( Why wont the Liberals unlock our personal pensions? )

My Reply

It Just doesn't make sense and I cant understand their thoughts because of these things.

A person that has a LIRF can invest their money and lose it all . ( they have no problem with that )

They allow the pension to be unlocked fully and transferred in to a RRIF If the pension holder dies and it goes to the spouse.

( I have no problem unlocking for the spouse) The Part I cant understand is if they can do that for one. Why cant they do it for two ? ( to me this doesn't make seance as the Plan Holder more the likely has more knowledge of the workings of the funds.

People like Jack & Malcolm & Gordon & CARP & Senior organizations endorse unlocking these pensions 100%.

Financle institutions say it would be better for them. ( Less paper work )

It would be better for the economy of Ontario.

Saskatchewan did it 5 years ago and Other provinces are following.

The people have been Asking for this to be done.


Greg Sorbara The Ontario Finance Minister Said "it is not to protect the people".

Greg Sorbara said "it was to protect the contract with the Employer " ( This Contract is no longer a contract when the plan is moved to a LIRF or RRSP ( The employer is no longer involved )


Is it that McGuinty and Company want to have power over the people of this province.

If there really a logical reason that they want to keep these pensions locked in.

I cant under stand it.

It would be sure nice if we could sit down face to face with the Liberals and let them logically explain why they refuse to unlock these pensions.

Regard Bill C

October 8th, 2007, 10:40 AM

Another issue, more a federal governance one, is the income splitting issue. The way it stands right now, as of the 2007 federal budget rule change, to split your pension income for tax purposes you can be of any age. To split your LIRA/LIF income the pensioner drawing the income must be age 65.

For example, if someone has a defined contribution pension and they move it at retirement to a LIF they can't split the income until they reach the age of 65. If they keep it with the pension holder and convert it to an annuity they can income split it at any age. Even though both are governed by pension rules only one option gets to file it as an income split before age 65.

October 10th, 2007, 09:34 AM

Hi Kreskin;
Thanks for that piece of information. It is important to many of us.
I will pass it on to my contacts and other forums after the election.

Regards Bill Costello

October 10th, 2007, 09:35 AM

DALTON MCGUINTY'S TIME ON AIR YESTERDAY

I know it is too late to change peoples minds about the people we are voting for , To Me it just shows how much disrespect the Liberal Government has for the people of this Province.

Below are a couple of letters sent out in disgust of what happened at a radio show that was to take call's to ask questions of the Premier.

<DIV>Good morning Eileen,

Yesterday afternoon, Michael Coren admitted on air that Mr. McGuinty had not, as had earlier been promised to CFRB listeners, opened the phone lines to the Ontario electorate.

Not only did we witness another brazen example of this man's contempt for Ontarians, but CFRB went on to support such deceit by announcing that there would be a repeat broadcast later in the evening.

Your unwillingness to expose this man for what he is ... one who refuses to have open and honest dialogue with Ontarians ... a glaring example being his recent brush-off of the Ottawa cancer patient ... has left me wondering if there is even one member of the media (CFRB included) who values truth and moral decency any longer.

Taylor Parnaby, during his news broadcast on Friday, October 05, 2007, was musing over the proliferation of "spin" . half-truths, quarter-truths and outright lies ... that is handed to Ontarians daily and how difficult it is, even for him, to get honest answers to direct questions. He went on to say that one person from one of the political parties who has been regularly sending him "spin", will no longer be welcome in his office, once the election is over.

Why didn't CFRB immediately take Mr. McGuinty off the air when it realized there would be no open phone lines for listeners? After all, listeners were being encouraged by CFRB, right up to the last minute before the programme aired, to call in if they wanted to speak directly to the Premier.

Just disgusted ... this blatant manipulation of Ontarians by our politicians has to stop ... otherwise our vote is nothing more than an exercise in futility.

Kenneth Elliott

<DIV>

October 10th, 2007, 09:39 AM

To: eileen@cfrb.com
Subject: The dalton love in hour

What a disgusting piece of tripe I heard on CFRB yesterday. I could not believe what went on. Back slapping Buddies IE: Sorbara, Bradley, and the hand picking of the easy questions,( and very few for that matter ), did it for for me. A real leader would not be afraid of the real questions, nor the real answers, but he just dodged every political issue that was important to your listeners. I speed dialed your show for the whole hour.This will have an effect on how much I listen to CFRB in the future. What a disgusting display of partisanship, back slapping hip hip Gee what a great guy I am Dalton Show. I could not believe a station like yours would allow such deceit , and the side stepping of the real important issues and questions in this election, that your listeners would have liked to put forth. A fed up listener. Philip James

October 18th, 2007, 08:58 AM

Hi All;
Below is a article many of you may have seen in the paper.
I just wanted to let you all know information I have received about the Commision Concerning the Study.

Pension law to be revamped

Posted 4 hours ago

Finance Minister Greg Sorbara says Ontario's pension law is out of date and needs a facelift.
He says the province is looking at revamping its pension law and has asked the Ontario Expert Commission on Pensions to hold hearings over the next few months. Sorbara says Ontario's pension law was a leader when it was enacted in 1986 but has lost pace with other regions.
The commission will take written and oral submissions from pensioners, employees, plan administrators and other interested people.
Hearings are set for Kingston, Ottawa, Sudbury, Toronto, Windsor and Hamilton.
The study is the first review of pension law in 20 years.

Information I have received.

The last time we contacted the Ontario Expert Commission on Pensions, they told us that unlocking of pensions was not included in the study.

Bill Gleberzon of CARP is submitting a large brief to try and change their minds and have them include unlocking pensions.

Many Members of The Coalition of independent holders have sent in e-mail submissions.

I encourage all people to still write their Premier and MPP's to unlock locked-in pensions.

We have not given up on this issue.

Regards Bill C

October 27th, 2007, 10:47 AM

Hi,
I assume that you have a Federaly Regulated Plan that you removed from your employer and transfered it to a RRSP LIF. If you go to my site I will tell you how to unlock the funds. I have done extensive research on this topic, and I am almost half way through my mission.
You will fing all the information you need. www.grundie.com/lif

Alex Grundie

October 28th, 2007, 10:02 AM

Hi All;

Here is some information on the Unlocking of your 25% in January. We Will still be going after the 100%. We are just letting the party's reorganize after the election.

Keep encouraging people to sign the online petition ( I will be mailing it in again ) and also Please keep mailing the Premier and MPP's and our soon to be new Finance Minister.

Take Care , Regards Bill C


Changes To The Rules For Ontario Locked-In Accounts
On July 27, 2007, O. Reg. 416/07 under the Pension Benefits Act was filed. The Regulation makes numerous important changes to the rules governing locked-in accounts. The following are answers to some of the questions that are likely to arise as a result of these changes. For ease of reference, the questions are grouped under the following headings:

Overview of changes
Q: What are the key changes to the locked-in account rules?

A: The key changes are:

A new Life Income Fund (the "New LIF") is introduced effective January 1, 2008. It will provide more flexible payments and allow owners a one-time opportunity to withdraw up to 25% of the amount in the New LIF.

An option to directly transfer money from a locked-in account to an unlocked vehicle, a registered retirement savings plan ("RRSP") or a registered retirement income fund ("RRIF") is provided in certain situations.

Effective January 1, 2008, owners of locked-in accounts who are non-residents of Canada, as determined by the Canada Revenue Agency ("CRA") for the purposes of the federal Income Tax Act, may apply two years after departure from Canada to withdraw the money in their accounts.

The current Life Income Fund (the "Old LIF") and the Locked-In Retirement Income Fund ("LRIF") will not be available for purchase after December 31, 2008.

Q: Which changes come into effect as of July 27, 2007?

A:

Owners of Old LIFs are no longer required to purchase an annuity by the end of the year in which they reach 80 years of age.

Owners of Old LIFs will be able to continue their LIF after they reach 80 years of age.

Owners of Locked-In Retirement Accounts ("LIRAs") can now keep the money in their LIRA until the end of the year in which they reach the age of 71 rather than the end of year in which they reach the age of 69. This reflects a change made to the federal Income Tax Act.

Owners of Old LIFs and LRIFs can transfer the money in their accounts to a LIRA prior to the end of the year in which they reach the age of 71.

Changes that affect the Old LIF
Q: I currently own an Old LIF. Do I have to make any changes to it to comply with the new rules?

A: There is no need to make any immediate changes to your LIF as a result of the new rules. However, since an annuity purchase is no longer required, you can continue your LIF past age 80 and you can transfer the money to a LIRA until the end of the year in which you reach age 71.

Q: Can I still buy an annuity with money in my Old LIF?

A: Yes, at any age.

Q: Will there be any effect on the amount of the annual income payment from the Old LIF in 2007?

A: No. The minimum and maximum amounts for the annual income payment for 2007 were established as of January 1, 2007 and will not change.

Q: Will the new rules change the formula for determining the minimum and maximum amount of the annual income payment for the 2008 year?

A: No. The minimum and maximum for 2008 will be calculated using the same formula as in 2007.

Q: If I want to transfer money out of my Old LIF, to which vehicles can I make the transfer?

A: You can transfer money in an Old LIF to a LIRA until the year in which you reach age 71, to another Old LIF or to an LRIF before December 31, 2008, or for the purchase of an annuity. After January 1, 2008, you will be able to transfer the money to a New LIF as soon as financial institutions make the New LIF available.

Q: What are the differences between the Old LIF and the New LIF?

A: The New LIF will have another option for determining the maximum annual income payments and you will have a time limited option to withdraw or transfer to an RRSP or RRIF 25% of the value of the funds transferred into a New LIF.

Q: Can I withdraw or transfer 25% of the funds from my Old LIF?

A: No. The 25% withdrawal or transfer option is only available under the New LIF.

Q: What happens if I die while I still have my Old LIF?

A: Your surviving spouse is entitled to the full amount in your Old LIF in an unlocked lump sum as of the date of death. If you do not have a surviving spouse on the date of your death, your named beneficiary, or if there is none, your estate, is entitled to receive the amount in your Old LIF. Effective January 1, 2008, your spouse will have the option of transferring the full amount to his or her own RRSP or RRIF where permitted by the federal Income Tax Act.



Changes that affect the Locked-In Retirement Income Fund (LRIF)
Q: I currently own an LRIF. Do I have to make any changes to it to comply with the new rules? What happens if I do nothing?

A: There is no need to make any changes to your LRIF as a result of the new rules.

Q: Will there be any effect on the amount of the annual income payment from the LRIF in 2007?

A: No. The minimum and maximum amounts for the LRIF in 2007 were based on the amount earned by the LRIF in the previous fiscal year and will not change.

Q: Will the new rules change the formula for determining the minimum and maximum amount of the annual income payment for 2008?

A: The minimum and maximum for 2008 will be calculated using the same formula as in 2007.

Q: If I want to transfer money out of my LRIF, to which vehicles can I make the transfer?

A: You can transfer money in an LRIF to a LIRA until the end of the year in which you reach age 71, to an Old LIF or another LRIF before December 31, 2008, or for the purchase of an annuity. After January 1, 2008, you will be able to transfer the money to a New LIF as soon as financial institutions make the new LIF available.

Q: What are the differences between the LRIF and the New LIF?

A: You will be able to withdraw or transfer to an RRSP or RRIF 25% of the value of the funds transferred into a New LIF and one of the methods by which to determine the maximum annual income payment (the cumulative investment earnings since the inception of the LRIF) will be replaced by the maximum amount under the LIF formula. If you transfer from an LRIF to a New LIF, you will no longer be able to carry forward the unused portion of your LRIF. If you do not use up the unused portion of your annual income payment in a fiscal year before your LRIF becomes a New LIF, you will no longer be able to add the unused portion to the maximum amount you can withdraw in future years.

Q: What happens if I die while I still have my LRIF?

A: Your surviving spouse is entitled to the full amount in your LRIF in an unlocked lump sum as of the date of death. If you do not have a surviving spouse on the date of your death, your named beneficiary, or if there is none, your estate, is entitled to receive the amount in your LRIF. Effective January 1, 2008, your spouse will have the option of transferring the full amount to his or her own RRSP or RRIF where permitted by the federal Income Tax Act.

The New LIF
Q: When will the New LIF be available?

A: The regulation allowing for the New LIF will come into effect on January 1, 2008. After that date, financial institutions will be able to make the New LIF available to consumers once they get approval for their New LIF contract from the Canada Revenue Agency.

Q: Who will be able to purchase the New LIF?

A: An owner of an Old LIF, an LRIF, a LIRA, or a member of a registered pension plan who has terminated employment and is entitled to an immediate pension, or the member's former spouse, may transfer their commuted value to a new LIF.

Q: What are the significant features of the New LIF?

A: First, you will be able to keep the New LIF past age 80. If you took the maximum income payment each year, your New LIF would be exhausted by age 90, but if there are assets remaining in the New LIF at age 90, you may continue to keep it and withdraw income from it in subsequent years. Second, the maximum annual income payment will be the greater of the amount you could be paid under the formula in the New LIF (which is the same as the formula in the Old LIF) or the amount of investment earnings of the New LIF in the previous year. Third, you will be able to withdraw or transfer to an RRSP or RRIF up to 25% of the amount transferred into the New LIF.

Q: How will the 25% withdrawal work?

A: Owners of a New LIF will have the one-time option of withdrawing or transferring to an RRSP or RRIF an amount up to 25% of the total market value of the assets transferred into the New LIF. The transfer to a New LIF may be from an Old LIF, an LRIF, a LIRA, or from a registered pension plan when an individual who is entitled to an immediate pension terminates employment and is entitled to a transfer of his or her commuted value. However, the 25% withdrawal will not apply when assets are transferred from one New LIF to another New LIF.

Q: When will I be able to make a 25% withdrawal? How do I apply, and to whom?

A: The owner of the New LIF will be able to apply to the financial institution that issued the New LIF within 60 days from the date the assets were transferred to the New LIF. Application must be made on a form that is issued by the Superintendent of Financial Services. The form will be available in January 2008.

Q: What would happen if I failed to make the 25% withdrawal within 60 days? Is there another opportunity to make the 25% withdrawal?

A: If you do not apply to make the 25% withdrawal within 60 days of a transfer of funds into a New LIF, there will not be another opportunity to take advantage of this provision

December 1st, 2007, 02:03 PM

Hi All ; This is a letter I just recently sent to Government. We are still working towards unlocking LIF's 100% in Ontario Regards Bill C

Dear Dalton and Members of Provincial Parliament ;

Congratulations on achieving a second majority victory.

I am writing you again to request that you take a serious look at the locked-in pension issue.

There is no logical reason that these pensions should be kept locked in. The statement your past Finance Minister gave on the Unlocking issue was ,

Quote " I don't think that this has any thing to do with protecting senior citizens from investors whether unscrupulous or not. It's about simply honoring the agreement the trust relationship between the employer and the employee at the time those funds were put in. "

I have talked with a few employers about the last statement about " honoring the agreement " .

Their response to that was , the agreement to provide , was a negotiation between the employer and the employed to provide a Pension for retirement. They did not feel that this pension should be locked in at retirement.

Many People were caught in this locked in Pension Scam .

I was one of them! I also have received hundreds of letters ,as I am sure You have ,that there are many people that were misinformed about these locked in pensions.

This is what happened to me.

When I was asked to join this pension plan in the 70's I was told that the employer would contribute 4% of my wage to a pension fund if I contributed 4% ( It was voluntary , some people did not join)

I was told I could contribute more if I wished as it would help to give me more money at retirement. I moved my contribution up to 10% thinking that this was a great way to save for retirement (( I was sure wrong on that thought ! ))

I faithfully put money into the plan believing how good things would be when I reached Retirement .

In the early 80's a financial planer from Standard Life ( The institution that looked after our fund )
told us about RRSP's and how they weren't locked in and how we would have complete control of them at retirement.

I then spoke up and said that we had best get out of our locked in fund then and invest in RRSP's (( everybody in our group agreed on doing this ))

The Planner then said " You don't have to make any change , If you quit before your normal retirement date . You will be able to transfer your funds into a RRSP "

The one important thing he didn't tell us was that it would be a Locked-in RRSP.

None of us therefore invested in a Unlocked RRSP.

Years later in 1999 a fellow worker decided to retire at 60. He left his job and applied for his retirement funds .
He then got the shocking news that he would be only able to basically withdraw $ 8000.00 for every $100000.00 that he had in his pension fund. (( His plan was still Locked-in )) Needless to say he had to go back to work.

When we seen what happened we immediately went to the employer and told him we wanted out of the locked in plan.
The Employer agreed saying that he also did not realize that the plan did not become unlocked at retirement.
We then started up a RRSP plan and the employer still put in their share of the money and we put in ours. The only thing that changes was the plan was not Locked in.

Changing the plan did not help many of us as some were already nearer retirement and I became disabled and was no longer able to do my Job.

Thank God I had invested in a RRSP for my wife and we were able to withdraw her funds as needed for the last 8 years or I would have lost everything that I had worked so hard for .

There are many people that I receive letters from that saved believing that they would be able to use these funds in their retirement as they wished.

They were misinformed by the financial advisers and led to believe that they would have full access to their funds. (( It Should be noted !! This is their Own Money and they took the Risks in investment ))

Will You Please tell me why your government will not unlock these funds for the seniors of Ontario!!

As I am sure You know that Saskatchewan has unlocked these funds 100% in 2002 for their Retired Seniors.

Manitoba has also unlocked 50% and is being asked to unlock the remaining 50%.

Alberta unlocked 50% and Now British Columbia is going to follow Alberta by unlocking 50% in it's Province.

Organizations such as Canada's Association For The 50 Plus , The Common Front For Retirement Security with 2 Million members across Canada , The Ontario Coalition of Senior Organizations ,
The Ontario Coalition of Independent Lif Holders. All back unlocking LIF's 100% at 55 years of age in Ontario.

Prominent People such as Professor Jack Mintz , Actuary Malcolm Hamilton , Financial Writer Gordon Pape .
All agree that Ontario should unlock LIF's 100% as Saskatchewan did for their Senior retiree's.

Please tell me what logical reason why the Government of Ontario feels that they should only unlock 25% instead of the full 100% of the Citizens own Money.

Bill Costello ,

December 9th, 2007, 08:57 AM

Hi Folks:
This is a Christmas Letter sent to Dalton. Maybe You would also like to send one and ask Dalton to think of the Seniors in the New Year instead of acting like Mister Scrooge.

Merry Christmas And a Prosperous New Year Regards Bill Costello.

Hon Dalton McGuinty dmcguinty.mpp.co@liberal.ola.org Premier

Hon Dwight Duncan dduncan.mpp@liberal.ola.org Minister of Finance

Hon Aileen Carroll carrollaileen@yahoo.ca Minister Responsible for Seniors

Good morning Mr. McGuinty,

Once again it is Christmas time and once again it is time to remind you of the plight of seniors who hold Locked-In pensions.

The Legislative Hansard reveals that on December 15, 1999 you asked the following question of then Finance Minister Ernie Eves.

"My question is for the Minister of Finance. Minister, with reference to Bill 27, we have discovered deep down inside a delightful Christmas gift that you intend to give to a select group of MPPs in this Legislature. I want to make it perfectly clear in this House today that I and my party will have none of it. Your special provision says that MPPs are going to have special access to their pension funds. You're going to give a right to MPPs that none of the other 11 million Ontarians are going to be able to enjoy. Your new bill will allow some of our MPPs to have instant access to their pension plan at age 55 when you're going to give no other Ontarian that said same right. Minister, how can you possibly justify this double standard?"

Bill 27 to which you referred was called An Act To Amend The Pension Benefits Act And The MPPs Pension Act. It received Royal Assent on December 22, 1999.

Despite you personally having voted against Bill 27, as did other members of your Liberal party, your words of December 15th 1999, ... "I and my party will have none of it" ... have proven to be totally false.

In fact, just the opposite has turned out to be the REAL truth.

There were members from your own Liberal party who received extraordinary financial gain with respect to their pensions, despite having voted against Bill 27. Further, the person who received the most financial gain was none other than your former Liberal colleague, Mr. Sean Conway.

Mr. Conway's own words from the Legislative Hansard for December 13, 1999 were ...

"Make no mistake about it: Some of us, with names like Conway, Harris, Eves, Sterling, Runciman, are very substantially advantaged by a portion of this bill, and it is wrong that we should be so advantaged. ........... What we have here today, I say to my friends, in one particular respect is another sweetheart deal for a few members of this Legislature named Harris, Eves, Conway, among others. I want to make it plain. No one benefits more from this change than I do. It's a wrong thing for me to support. I would go even further and say it's immoral."

Today, Mr. Conway has unfettered access to over $1 million of pension money that had previously been designated as Locked-In pension money. Yet he said such exclusive privilege was both wrong and immoral.

Now, let us fast forward to Christmas 2006.

As reported in the CTV article below of December 21, 2006, you Mr. McGuinty, were initially opposed to the magnanimous pay raise that was being proposed for MPPs. However upon the final vote being taken, you ended up being a major recipient of this magnanimous pay raise.

Once again, MPPs, including yourself, received extraordinary financial gain just before Christmas. Once again too, you have profited from gains achieved, in some measure, on the backs of seniors who hold Locked-In pensions.

Where certain special MPPs in 1999 received unfettered access to their pension monies at age 55, monies that had been accrued entirely from within a defined benefit plan called the infamous MPPs gold-plated pension plan, you now have had the audacity to allow seniors unfettered access to only 25% of their pension money, with the full access being delayed until age 90.

As you well know, most seniors will not be alive at age 90 and as such will forfeit much of their hard-earned pension monies to the government in the form of estate taxes. Yet your fellow Liberal colleagues such as Jim Bradley, Sean Conway, Elinor Caplan and Tony Ruprecht, and the list goes on, who also may not be alive at age 90, get 100% unfettered pension access at age 55 and thus are able to enjoy their pension monies while still living.

It is these forfeited pension monies that are paying a portion of your magnanimous pay raise.

Also, the CTV article below makes reference to the fact the MPPs no longer have a pension plan. Such information from MPPs is flat-out deception of the public through semantics. Each MPP does have a pension plan. It is called an RRSP plan to which they now have unfettered access. What each MPP no longer has though, is membership in the former MPPs gold-plated defined benefit pension plan. Under relentless pressure from the public because of the inordinate pension benefits that politicians had bestowed upon themselves over the years, this plan was dissolved in 1995.

The 10 per-cent of earnings that is now being contributed to each MPP's RRSP plan is in part coming from seniors who own Locked-In pensions. These are the same people Mr. McGuinty, to whom you refuse to extend unfettered pension access privileges.

Mr. McGuinty, as you attend the Christmas recital at the school where your wife teaches, look around the room and see the number of grandparents that are there proudly supporting their grandchildren's efforts. Some of these grandparents own Locked-In pensions and as such are unable to enjoy the quality of life during their golden years that they deserve.

Why? The answer is quite simple. You are denying them unfettered access to their own hard-earned pension monies while they are living. Yet at the same time you demand that they pay for your magnanimous pay raises and your rich pension buyouts of 1999.

Your recent announcement of a national holiday in February is nothing but another example of a cruel shell game perpetrated in part against seniors. Everything costs, including your new holiday announcement and for sure it will be seniors with Locked-In pensions who will once again be asked to dig a little deeper.

Why is a lock on one's financial assets, especially seniors, only acceptable for ordinary Ontarians but not acceptable for you Mr. McGuinty?

As we await your Christmas message and hope upon hope that you don't find another way to award yourself another delightful Christmas gift, will you answer your own question as it relates to Locked-In pensions ... that is the question you asked of Mr. Eves back in 1999 that is still waiting for an honest answer today?

"How can you possibly justify this double standard?

I, along with hundreds of thousands of other seniors, await your answer.

Kenneth Elliott