Pension reform won’t affect retirees: premier
Premier Kathy Dunderdale wanted to ease concerns as much as possible Thursday as she addressed the thorny issue of public-sector pension plan reform.
“A very particular message we want to bring to retirees today is that any recommendations that come out of this process will not affect them. Benefits that pensioners now receive will be maintained, including their health plan,” the premier said at a news conference outside the House of Assembly.
A report by Moody’s released Thursday on the issue didn’t seem to surprise the government, but simply reinforced that something has to be done. A government news release highlighted that as of March 31, 2012, unfunded pension and other post-retirement liabilities represented approximately $5 billion, which accounted for approximately 64 per cent of the province’s net debt.
Finance Minister, Jerome Kennedy joined the premier at the news conference. He said he had met with the unions prior to meeting with the media to inform them that the process of pension reform had begun.
“We’re cautiously optimistic that we’ll all come to a resolution,” he said.
Neither the finance minister nor the premier could give any more detail on what that resolution would be, saying only that they were starting to look for one. They said they will come to an agreeable decision for all parties involved through research and consultation.
“We’re going to look at everything,” Dunderdale said. “Information is a good thing.”
As vague and as encompassing as her remarks were on the subject, the premier and the finance minis- ter both gave the impression that they would look at and listen to as much advice and information on the subject of pension reform as possible.
They said this will include such things as hiring pension consultants and actuaries to look at the issue, and looking at what other provinces have done. There will also be collaboration with the unions involved, they said.
“We’re addressing the issue, but the point that the premier has made is that this will be a collaborative process. It will be consultation that will take place, and no decisions have been made. We’re going to look at everything and address the issue,” Kennedy said.
He added that the unions had indicated to him that they are all committed to working through the process with the government.
The premier couldn’t give a time frame on how long the process would take, but said that once reform is finalized, people who would be affected would have ample time to make personal decisions based on the changes.
“If we’re going to change that plan in any kind of a way, you will have lots of time to make decisions about your retirement or staying on before those changes are implemented,” she said.
Since 1997, nearly $4.5 billion in special payments has been contributed to the pension plans. Despite this, the outstanding unfunded liability continues to grow.