AFL: Redford government's proposed cuts to public sector pensions are "unjustified, unfair and reckless" | National Union of Public and General Employees

AFL: Redford government's proposed cuts to public sector pensions are "unjustified, unfair and reckless"

"There's an old saying that if something isn't broken, you shouldn't try to fix it. This is a perfect time for Albertans to be reminded of that saying." -  Elisabeth Ballermann, HSAA President.

Edmonton (15 Jan. 2014) –  A new study prepared by an independent, professional actuary shows that Alberta's largest public-sector pension plans are healthy and well on the way to returning to fully funded status – even without any changes to benefits.

New research shows Alberta government justifications for cutting pensions are unfounded

The results of the study fly in the face of arguments used by the Redford government to justify its plan to roll back pensions covering almost 300,000 public-sector workers and pensioners in Alberta.

In the fall, provincial Finance Minister Doug Horner announced that major changes would be made to Alberta's four public-sector pension plans, including the two biggest, the Local Authorities Pension Plan (LAPP) and the Public Service Pension Plan (PSPP).

In particular, Horner said he would bring in legislation in the spring of 2014 that will allow him to eliminate guaranteed cost-of-living adjustments and all early retirement incentives for workers covered by plans like the LAPP and PSPP.

Taken together, Horner's proposed changes would slash the value of pensions earned by Alberta public-sector workers by 25 per cent or more on benefits earned after January 1, 2016.

Horner has said the changes are necessary to ensure the sustainability of Alberta's pension plans. However, the report from actuaries at Vancouver-based George & Bell Consulting shows that both the LAPP and PSPP are sustainable and healthy over the long-term without any changes.

Study concludes Alberta pension plans are sustainable and will return to fully funded status in nine years

The George & Bell study concludes that, under the most likely economic scenario and with no major changes to benefits, both the LAPP and PSPP will return to fully funded status within nine years.

The total costs of the plans are also expected to drop. Costs for the LAPP will drop to the equivalent of 20 per cent of payroll (split between employers and employees) and costs for the PSPP will drop to 16 per cent (also split between employers and employees).

Even under the most pessimistic scenarios, the study shows that both the LAPP and PSPP will dramatically improve their funding status and keep costs under control – without having to resort to any of the deep cuts proposed by the Redford government.

Unions commissioned the study to challenge the government's position with fact-based evidence

The George & Bell study was commissioned by a coalition of unions and associations that have members in LAPP and PSPP. The coalition includes: the Alberta Federation of Labour (AFL), the Alberta Fire Fighters Association (AFFA), the Alberta Union of Provincial Employees (AUPE), the Amalgamated Transit Union (ATU), the Canadian Union of Public Employees (CUPE), the Health Sciences Association of Alberta (HSAA/NUPGE), the United Nurses of Alberta (UNA) and a number of smaller unions.

The study was recently submitted to Minister Horner in support of a brief from the Coalition opposing the government's plan to make major changes to pension plans like the LAPP.

More information: 

NUPGE pension resources


The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE


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