Doug Horner, president of the Treasury Board and minister of finance for Alberta announced changes to the Alberta Public Sector Pension plan. According to Mr Horner, there is no crisis today, but rather the longer sustainability of the plan that needs to be addressed.
Reforms will take effect on or after January 2015. Current pensioners won’t be affected but public sector employees whose retirement dates are after 2015 will be.
Below is a list of some of the proposed changes, to review the full government proposal click hear.
- There will be a moratorium on benefit improvements until January 1, 2021.
- Cost-of-living adjustments (COLA) on benefi ts earned after 2015 will be “targeted” at 50 per cent of the Alberta inflation rate.
- Contributions will be set so that there is a high likelihood that the“target” COLA will be paid, but it will no longer be guaranteed.
- All early retirement subsidies will be removed for benefits earned on service after 2015.
- MEPP will be closed to new members effective at the end of 2015 but will continue to operate as a closed plan.
The government will be consulting with employee and employer stakeholders until the end of December 2013.