Dear Local 115 Member,
Our LAPP pension plan is currently under attack in the Alberta legislature. Bill 9, otherwise known as the Public Sector Pension Plans Amendment Act, is now at 2nd reading. The changes outlined in Bill 9 will severely undermine the long term sustainability of our plan, as well as cut our benefits. The entire legislative opposition parties of all political stripes are unanimously opposed to Bill 9. You must take a few minutes out of your busy schedule to fully appreciate the degree to which our plan will be affected, and at the very least send your MLA an email voicing your disagreement with the Bill. This is just as important as negotiations because the pension plan is a major part of our benefit package. On the Truth About Alberta Pensions website (link below) you can calculate how much these changes will impact you. Most estimates are that pension payouts will be reduced by 15-25%.
The Local Executive implores you to contact your MLA between now and May 2nd while they will be on a constituency break. Send an email, call their office, or better yet meet them in person and take a friend with you. Personalized letters are more effective than form letters. There are lots of resources to help inform you, links are at the bottom of the page, including an MLA finder. Tell your family members because this will affect them too, when your financial plan for retirement will be sabotaged by the provincial government for no good reason. The government must hear from you that you do not support their plan to unilaterally change our negotiated benefit package without evidence that change is even necessary. Tell them you want to be consulted and negotiation must take place first.
LAPP is currently healthy now, has a plan to pay down the unfunded liability, and is on track to get healthier with the plans the pension board have already put in place. Government intervention is not necessary, the expert pension board is fully capable of managing the plan. Would you rather have a pension board composed of employee and employer stakeholders with a vested interest in the plan’s outcome in control, or shift power to the Minister of Finance, whoever that might be at any given time? The bottom line is that Bill 9 makes the wrong prescription for our pension plan, because the government made the wrong diagnosis in the first place. All of the arguments provided to rationalize Bill 9 are completely disingenuous and misrepresent the truth.
Here are just a few of the reasons this Bill will severely undermine our plan:
- Changing the early retirement age to a 90 factor from an 85 factor, and making large increases to the penalties if you retire prior to 65 or the 90 factor.
- The Bill would allow the Minister of Finance to unilaterally and fundamentally change the way benefits are calculated for the purposes of remuneration of retirees.
- The Bill would set an arbitrary cap on contributions to be determined by the Finance Minister, meaning the only way to ensure the plan stays healthy in the event of a market crash is to reduce the benefits of retirees.
- The government is making these changes through legislation rather than by negotiating because they know that we would not accept these changes otherwise.
- The Bill will create 3 tiers of pensions, one for pre-2016 benefits, one for post-2016 benefits, and one for predominately male occupational groups like firefighters, and paramedics who are excluded from most of these changes.
- Cost of living adjustment for retirees is currently guaranteed at 60% of inflation, but the Bill would change this to only a TARGET of 50% and only in certain circumstances. That means you could be getting the same value of pension when you retire at 65 as you would when you are 85 that has not kept up with inflation.
Your pension plan and retirement security are at risk NOW, your action is urgently needed. We want our plans to be sustainable too, and they are. They want you to take all the risk while they make all the decisions, which should be made by the pension board. This legislation is harmful and unnecessary. Don’t be tricked out of your pension, act now.
UNA’s info page and open letter to MLAs: http://www.una.ab.ca/332/government-pension-bill-puts-alberta-on-the-wrong-track
MLA finder (use your postal code or street address): http://www.assembly.ab.ca/lao/mla/mla_help.htm
Pension calculator and information http://truthaboutalbertapensions.ca