Pension reform meeting gets heated
Emotions were high on Thursday evening at the Sheraton Hotel in Red Deer as 15 presenters made their cases to the standing committee on Alberta’s Economic Future in regards to the heated topic of pension reform.
Earlier this year the provincial government proposed pension legislation changes in the forms of Bill 9, Public Sector Pension Plans Amendment Act, and Bill 10, Employment Pension (Private Sector) Plans Amendment Act.
The government says the bills, which largely reduce pension benefits and put a cap on contributions by employers and employees, are to make the pension plans more sustainable and help the $7.4-billion in unfunded liability in Alberta’s public sector pension plans.
Last month, in a response to strong backlash, Finance Minister Doug Horner referred the bills to a committee, who met with pension experts and stakeholders and held public meetings in seven communities. Red Deer was the last stop of the tour and over 100 people filled the room.
Mark Hercina, a correctional peace officer, told the committee that the proposed pension changes are forcing senior staff out, wreaking havoc when it comes to retention and recruitment efforts in the workplace.
“When you’re attacking the pension there is no recruitment . . . When senior staff are feeling forced out, we’re losing that knowledge and experience,” Hercina said.
Brenda Reid of Stettler County said with the new changes, it looks like she will be living in poverty after she retires.
“Even if I wished to retire early, it would be impossible to do so . . . What do I have to look forward to? Working until I can’t enjoy my grandchildren?” she asked the committee. “Pension plans need to be a joint partnership between the people of Alberta and front line public employers.”
Reid said she’d been looking ahead at the “85 factor” all her working life — the factor that allowed employees to retire with an unreduced benefit as early as age 55, if they had 30 years of pensionable service.
With Bill 9, that has been replaced with a 90 factor meaning to retire five years early (at age 60) an employee will now need 30 years of service instead of 25.
“Every person I know that I work with does more with less now. Yet you’re telling us that our bodies are going to have to last five to 10 years more before we can retire. You’re not going to see that,” said Jules Noel, an Alberta Health Services employee. “Taking away the 85 factor is just wrong . . . It’s like the bank saying they’re going to add five more years to the end of your mortgage because they didn’t manage their funds properly.”
Jason Heistad, the executive secretary-treasurer with the Alberta Union of Provincial Employees, said he worries about people’s cost of living going up while their modest pension cost of living adjustments have now become at risk.
“I think these changes were brought about in a short sighted attempt to win over the private sector workers who don’t have a pension of their own but you’ve run into a problem here because Albertans do have a sense of fairness and I don’t like the idea of government dictating these sort of changes to people,” Heistad said.
The consensus from the public presentations has been overwhelmingly negative, said committee member David Eggen, the NDP MLA for Edmonton-Calder.
“People are interested in seeing both Bills 9 and 10 simply cancelled,” he said, noting there have only been three or four presentations out of over 300 that were in favour of the reforms. “Alberta New Democrats believe strongly everyone should have a pension built into their future. It’s a way to build a secure and healthy society and we want if anything to strengthen the pension.”
Members of the public have until Aug. 15 to submit written submissions after which the committee will be compiling a report to present before the legislature in October.