NLEC Executive Director Richard Alexander addressed Minister of Finance Tom Marshall Friday as part of government’s pre-budget consultations. Alexander urged government to develop an aggressive and proactive plan for debt reduction that should include evaluation and reform of the current public sector pension plan.
In his opening presentation, Marshall told attendees that unfunded pension liabilities and post retirement benefits account for 66% of our province’s nearly $8 billion in debt. While the NLEC applauds this government’s commitment to put future surpluses toward debt reduction, it is clear a more aggressive plan is needed. The NLEC is calling for government to conduct a review of the current public sector pension plan and evaluate options to create a pension plan that is financially sustainable; does not negatively impact the resources government can put toward programs that benefit all citizens of the province, such as health care and education; do not compete with the private sector; and are fair and equitable to what non-public sector workers receive.
The NLEC is not requesting changes to pensions of current public sector workers, but an evaluation of options moving forward. These options would include those that have been implemented by private sector organizations, such as increasing the age required to access pension benefits, changing the method of calculating pension benefits from final salary to career average, and switching from defined benefit to defined contribution.
View some media coverage on this issue:
The Telegram (Print & Online) 14/1/2012
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