Pension plans around the world are facing challenges because people are retiring early and living longer, investment returns have been lower, and the ratio of pensioners to active members is increasing. Many plans are unsustainable in the long term if changes are not made. In Alberta, our public sector pension plans face the same challenges, which have resulted in funding shortfalls and dramatically rising contribution rates.
On September 16, 2013, Doug Horner, President of the Treasury Board and Minister of Finance, announced the government's vision for public sector pension plans, including the Local Authorities Pension Plan. These proposed changes would significantly alter the Plan moving forward, and will deeply affect municipalities.
The Government of Alberta is engaging in consultations around these changes until December 31, 2013. The AAMDC is encouraging members to participate in this consultation by submitting your municipality's concerns directly to email@example.com by December 31, 2013.
In a parallel effort, members are also encouraged to submit comments and concerns directly to the AAMDC online by Monday, December 16, 2013. The AAMDC Board of Directors will review information gathered to determine if a formal advocacy position(s) can be adopted regarding the pension reform proposal as they affect LAPP. The AAMDC asks that members consider the impact of the proposed reforms from both the employer and employee perspective when submitting comments.
Given the tremendous impact these proposed changes would have on the municipal sector, several municipalities are requesting an extension to the consultation deadline as well as, in conjunction with AAMDC and AUMA, the undertaking of education sessions in the first quarter of 2014 so that employers are able to better understand and respond to the proposed changes.