Story from the Telegraph. Converting to shared risk, even though there is no MLA pension fund, given that fact this would be a perfect time to convert MLAs to an RRSP model. MLAs can take the RRSP fund with them in their next job, and taxpayers have zero liability going forward ... and am I reading this right, changes will be on a GO FORWARD BASIS? If so, this is hypocritical of what was done to the former PSSA. Tories reform MLA pensions CHRIS MORRIS Legislature Bureau March 26, 2014 Premier David Alward Photo: GREG AGNEW/TIMES & TRANSCRIPT ARCHIVE FREDERICTON – Critics have called it “a gold-plated pension plan,” but New Brunswick’s Tory government is removing much of the lustre from retirement packages for elected members of the legislature. In a newspaper commentary with the heading “Time to do our Part,” Premier David Alward said his government will bring forward legislation on Wednesday to change the MLA pension plan to a shared-risk model. Once passed, the change will be dramatic. A new MLA would have to be elected four times and work about 16 years to receive a pension similar to what is now receive for eight years of service. As well, MLAs will have to wait until they are 65 before they can begin collecting a full pension. Under the current model, they can start cashing in at 60. “This decision is about demonstrating to New Brunswickers that everyone has a stake and a role to play in pension reform,” Alward states in the article. “MLAs are no different.” Ever since the Progressive Conservative government embarked on pension reform early in its mandate, Alward and Finance Minister Blaine Higgs have said everyone has to share in the pain of making public sector pensions less of a burden to taxpayers. Under the legislation, MLAs will become members of the same plan that now covers many of New Brunswick’s public servants, the Public Service Shared Risk Plan, which became law in January. Hundreds of public sector retirees have protested the imposition of the shared-risk model, saying it breaks their pension agreement and makes the future of their plans less certain, especially in terms of cost-of-living increases. Under the shared-risk model, employers and employees split the costs when the plan performs poorly and share the benefits when it does well. Some pensioners have promised legal action to try to stop the shared-risk model, and many say they will lobby against the Tories in the September election. The province’s teachers, now in negotiations with the government for pension reform, have said that while they agree with the need for change, they are searching for a model other than shared-risk. Alward said the change to the MLA pension will save $1.3 million per year in pension expenses. “But it is about more than just saving money,” he said. The pension for a member who serves for eight years currently pays $20,400 annually upon retirement. That is already down about one-third after the Tories cut pension income in 2011, nearly reversing a significant raise MLAs gave themselves in 2008 that saw pensions for members serving two full terms in the legislature increase to $30,600 annually. The Canadian Taxpayers Federation has been highly critical of New Brunswick MLA pensions in the past, noting in a 2010 report that a retiring MLA will have received $16 in taxpayer contributions for every single dollar the politician pays into the fund. Kevin Lacey, Atlantic Canada spokesman for the taxpayers federation, said he likes what he hears about the Tory government’s proposed changes. “We have long called it a gold-plated pension plan,” Lacey said. “But from what I know of the changes, this would take the gold off the pension, so to speak. “No worker wants to see what they get cut back, and politicians are no different. Yet the government has decided to bite the bullet to do the right thing and reform their pensions to ensure that their deal is no better than anyone else in government.” Alward said the changes to the MLA pension plan are in line with retirement packages in Quebec, Saskatchewan and Ontario, as well as what could be earned by someone working in the public or private sector. “On a go-forward basis, retired MLAs will receive a cost-of-living increase on par with what is received by retired public servants,” the premier states. He said fair and equal treatment is at the heart of the MLA pension reform. “As MLAs, we believe all public servants should have access to a fair and reasonable pension, but that the benefit should not be greater for someone who goes to work at the legislature than it would be for someone working in a school, hospital or government office,” Alward states.
Posted on: Wed, 26 Mar 2014 11:34:17 +0000
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