Finance
December 6, 2006

Borrowing Program Brings Stability to Public Service Pension Plan

The Williams government is moving ahead with its strategy to stabilize the Public Service Pension Plan (PSPP), said the Honourable Loyola Sullivan, Minister of Finance and President of Treasury Board.

This strategy entails borrowing from capital markets, sees an infusion of $400 million in the PSPP this month and anticipates another payment before the end of this fiscal year.

�Our borrowing rate is 4.5 per cent for a 30-year term. We are in a position to take advantage of the current borrowing rates which are the lowest rates I�ve seen historically,� said Minister Sullivan. �Funding the PSPP now makes excellent financial sense and it also gives our public service employees the stability they deserve as they look to their future retirement.�

The move is similar to the promise government fulfilled in March when it provided a $1.953 billion payment to stabilize the Teacher�s Pension Plan (TPP). Government committed to public servants to put the PSPP on stable footing.

In the past year, the province has received rating upgrades from all three credit rating agencies allowing the improved borrowing rate.

�Our administration has practised prudent financial measures and we are reaping the benefits of that now and passing those benefits on to our public servants,� said Minister Sullivan.

View Ministerial Statement

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Media contact:
Deborah Pennell
Director of Communications
Department of Finance
709-729-6830, 685-6612
deborahpennell@gov.nl.ca