Public Service Pensions - Your Questions
1. What is the Institute doing to protect and defend Public Service pensions?
The Institute has pension professionals that are working with other bargaining agents to prepare a strategy in the defence of public service pensions. Members of the Board of Directors and staff have engaged with the media to discuss the Institute’s position. In addition, the Institute has been working with other bargaining agents and engaging in discussion on various pension blogs.
2. What will the government likely attack with respect to public service pensions?
We cannot be sure. There are reports but mostly rumours that the Government will attack public service pensions. The bargaining agents and the Institute are prepared for such an attack and have been addressing many issues behind the scenes. Please refer to our website in the near future for more information.
3. What changes will the government likely make to the Public Service Pension Plan (PSPP)?
The government has not released any plans for the PSPP to date. Care should be taken not to get overly concerned by rumours.
4. Will or can the government retroactively remove or take away pension that I have already accrued or earned?
Modification to the Public Service Pension Plan (PSPP) requires a legislative amendment to the Public Service Superannuation Act (PSSA) and any legislative amendment would not normally involve retroactive reduction in any benefits that have already been accrued; that is to say, any changes would be on a going-forward basis.
5. Will the Public Service Pension Plan (PSPP) be changed in the near future?
The provisions of the PSPP are enshrined in an act; i.e. the Public Service Superannuation Act (PSSA). As the sponsor of the PSPP, the government may change the PSSA at its will through legislative amendments. The PSPP is not subject to collective bargaining. Changes are normally made without warning and can happen at any time.
6. Should I consider retiring or resigning as soon as possible before changes are made to the PSPP?
No. The longer you stay in service, the higher your PSPP pension will be. Increase to your PSPP pension is calculated by your length of stay in service and your accrued pension credits.
7. Are public service pensions “golden”? Do we get more than the average person in the private sector?
Public service pensions are no more generous than the average defined benefit plan in the private sector. For example, the pension formula under the PSSA plan is 2.0% multiplied by years of service multiplied by one’s average salary over their best 5 years. This example is common, if not the most common defined benefit formula in the private sector also. Are our public service pensions more golden than the private sector? Recently the Canadian Labour Congress (CLC) obtained the average pension plan paid out of over 275 pension plans from affiliated bargaining agents. Nearly 30% of these plans paid out an average pension very similar to, if not better than, the average pension paid out of the PSSA plan.
8. How does the Institute’s joining the Canadian Labour Congress help safeguard against unfavourable changes to the PSPP?
The CLC encompasses many unions across the country. Some of the member unions cover public servants at the provincial or municipal levels. The CLC’s main emphasis on pension issues pertains to national programs such as the Canada Pension Plan (CPP), Québec Pension Plan (QPP), the Old Age Security (OAS) and the Guaranteed Income Supplement (GIS) programs. As a CLC charter member, the Institute can network with all charter members, facilitating strategy discussions on how to best defend your pension plan and gives the Institute access to their research.
9. What is the Institute doing to defend and safeguard public service pensions, the CPP, the OAS and the GIS?
The Institute is working with the CLC and other bargaining agents to help defend these Canadian rights for all Canadians. In addition, the Institute actively assists individual members with their personal pension issues Pension experts at the Institute’s National Office have participated and continue to participate in public debates on pensions through webinars, radio and TV interviews in the media.
10. Do changes to the Old Age Security (OAS) or the CPP/QPP affect my retirement pension under the PSPP?
No. The OAS, CPP/QPP and PSPP are distinct plans and do not interact. The amount of reduction in your PSPP retirement pension at age 65 relates to your years of pensionable service after 1965 under the PSPP. This PSPP reduction not depend on the amount of your OAS and CPP/QPP pensions, irrespective of the age at which the CPP/QPP retirement pension starts being paid to you. For your convenience, you can access a description of recent changes to the CPP and the QPP through these links: http://www.servicecanada.gc.ca/eng/isp/cpp/postrtrben/main.shtml and the QPP http://www.rrq.gouv.qc.ca/en/retraite/rrq/Pages/calcul_rente.aspx