President of Bahamas Supermarkets Limited (BSL) Mark Finlayson yesterday assured that the pension fund of City Market employees remains sound.
He said measures are being taken to ensure it remains viable for many years to come.
In an interview with The Nassau Guardian, Finlayson said the trustees of Bahamas Supermarkets Employee Retirement Fund are looking for a buyer for the building on East West Highway that is currently the headquarters of Bahamas Supermarkets.
He said the building was appraised at $9 million in 2009 and the trustees think they could get at least $6 million for the building.
The building is owned by the trust, he said.
"The trustees have acted the way we were supposed to act according to the trust deed," Finlayson said.  "I want to make sure it is clear that we have acted well on behalf of the beneficiaries because that's extremely important."
He noted that there is a big difference between the pension fund trust and Bahamas Supermarkets Limited.  They are two competely different entities, he stressed.
Finlayson, who is one of two trustees of the pension trust, said it remains non-contributory.
The trust gets rent from BSL for use of the building and it also gets rent for equipment at the Cable Beach store.  That is because the equipment is also owned by the trust and not BSL, Finlayson explained.
Under the trust deed, the pension plan is structured to benefit from profit sharing as well, he said.
Currently the company is losing money, according to Finlayson, but he said he is confident his group will turn it around.
He said former owners of the City Market chain used $3 million from the pension money and invested in the Cable Beach equipment.
"The employees shouldn't sit down and worry if something happens to BSL whether or not they are going to lose their pensions," Finlayson said.  "They will not lose their pensions because the point is the building is there."
He said the trustees are trying to sell that building based on the recommendation of a forensic accountant.
"We are trying to sell this building in order to raise the cash to make sure the beneficiaries when their time comes to retire, their monies will be there," Finlayson said.
He said when his group took over the company early this year, there was $1.9 million in the trust.
The new owners decided to offer early retirement to qualified beneficiaries.
Finlayson said in order to qualify, workers had to have had full time employment with BSL for 25 continuous years or have reached age 55 with 10 plus years of service.
Under normal entitlement, employees could only benefit when they reach 65.
A terminated employee, as long as he or she was not fired for stealing, could under normal entitlement benefit from the trust at age 55.
Finlayson said more than 25 employees benefited from early retirement.  This was done "for their benefit", he said.
"There's a good relationship between us and those who retired," he added.
Under the retirement program that was in place under previous ownership, an employee who reached 65 could qualify for pension, but could only get 20 percent up front, Finlayson said.
The other 80 percent was placed into an annuity, and the pensioners were often penalized when they accessed that 80 percent.
"They've gotten 100 percent of their money, which is something that's unusual," said Finlayson, referring to the employees who took advantage of early retirement, which was offered on a first come, first served basis.
Finlayson said he and the other trustee, Philip Kemp, felt it important that the employees should get all of their money up front.
"From our standpoint we thought this money doesn't belong to anyone else but the beneficiaries," he said.  "If they want to put their money in an annuity, they should be free to do so."
BSL employs more than 500 people, but not all of them qualify for the plan.  In order to be in the plan, an employee must have completed 10 years of continuous employment, Finlayson said.
"There are a number of employees who just received (collectively) $2 million in early retirement," he added.  "So, you know, the proof is in the pudding."
Finlayson said the trustees are acting purely from "a human element".
"This is money that does not belong to me," he said.  "It does not belong to my family.  It does not belong to BSL.
"We met just under $2 million inside there (the trust) and one of the things is I wanted to make sure temptation was out of the way.  That was the reason why we gave that money to people who were entitled to it."

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