Edmonton – Alberta’s finance minister met with representatives from Alberta’s public sector unions Monday morning over concerns about public pension sustainability in the province.
Doug Horner is introducing proposals he believes will improve pension security.
The finance minister says he’ll spend the next three or four months consulting with stake holders about reforms to public sector pension plans.
Minister Horner says lower investment returns, early retirement, and increased life expectancy means current plans won’t catch up to future financial commitments. It’s the reason the minister is concerned about the sustainability of the plans.
“We’d like our employees to stay and work and contribute for as long as they’d like. So early retirement is an incentive we’d like to move away from, and that’s one of the planned changes that we put on the table today,” says Horner.
On Sunday, presidents of four public sector unions said the government is manufacturing a crisis to justify cutting Albertans benefits and raising the age to collect retirement.
The Board of the Local Authorities Pension Plan (LAPP) has reported to the finance minister the plans are sustainable and there is a plan to have them fully funded within seven years.
“They’re about 82 per cent funded now. They were 100 per cent funded until 2007, I believe, and there was a down turn,” says NDP leader Brian Mason. “So they’re not fully funded, but they’re well on their way to being fully funded. So there’s no reason in my view to for the steps that have been taken today.”
Minister Horner has announced any changes in the proposals wouldn’t take affect until 2015.
He will be consulting with employers until December, ahead of legislation discussion in the spring of 2014.
Union leaders will be speaking about Horner’s pension announcement at 3 p.m. on Monday.
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