Statement from CUPE Alberta President Marle Roberts
On February 24th, the Redford government announced changes to its pension reform package.
Although the government and some media reports have characterized the revised government position as a reversal of previous cuts, a careful look at the fine print makes it clear that the government’s position hasn’t changed very much.
The Redford government is still gutting our pension plan, and we need to continue to oppose their actions.
Here is a summary of the proposed changes as they currently stand:
Early retirement: The Redford government is now proposing to change pension benefits so early retirement is only available to workers who are at least 60 years old and have a combined age/years of service total of 90.
This is slightly better than their last proposal, as a few people may be able to retire early. But it still means working longer and likely receiving a reduced pension.
They are also making it harder to retire early with a penalty. Currently, if you retire before getting to the 85 factor (age plus years of service equal 85), there is a penalty of 3% for every year you retire early. In other words, if you retire two years before hitting your 85 factor, your pension is reduced by 6%. Under the Redford reforms, that penalty is increased to 5% for every year of early retirement.
- Indexing: Under current pension rules, retirees are guaranteed to have their pensions indexed to 60% of inflation. The government is refusing to continue that guarantee, now characterizing cost of living increases as a ‘target’ which will not always be implemented. This means pensioners will see the value of their pension rapidly decrease as they get older.
- Cap on contributions: The Redford government is still pushing for a cap on pension contributions. This could be very harmful to the health of our pension plan, particularly if there is another market crash. As long as this is on the table, no one’s pension is safe from future cuts.
Three tiers of pensions: The government is proposing three different tiers of pension plans. One for pre-2016 benefits, one for post 2016, and one for firefighters, paramedics, and corrections officers. It is not fair that one group of workers will get a better pension plan than another. We all serve our communities, we all pay into our pensions, and we should all have pensions that operate under the same rules. This is an attempt by the Redford government to ‘divide and conquer’ public sector workers.
Joint trusteeship: CUPE has long supported a pension plan where workers have an equal say with employers over the management of the fund. Alberta is far behind other provinces in not providing this method of managing public sector pensions.
The Redford government is now offering joint trusteeship – that’s a good thing. But they are insisting that the reforms mentioned above be implemented first, and that the trustees cannot make changes to them.
This gives employees a say over the management of their pensions after Alison Redford has taken steps to starve the plan of funds, and after she has put pensioners into poverty.
If Alison Redford is serious about joint trusteeship – she should implement it now, and employees and employers can negotiate changes to the plan as equal partners.
The changes announced this week are not real changes, and do not come about from discussions with employees and their representatives.
However, the changes announced this week do mean one thing – we are making the Redford Government nervous. Conservative MLAs do not like getting angry calls and emails from public sector workers, and they are trying to appease us into silence. We have to keep up the pressure.
We need to see you at the Churchill Square rally this Sunday, and we need you to keep up the pressure on Conservative MLAs to ensure retirement dignity for you and your co-workers.