CSSF Working Group Update

President's Letter to PEI UPSE Membership

Posted: November 08, 2012.

PEI Union of Public Sector Employees

The union held its 51st Annual Convention on Saturday, November 3rd, 2012. Susan Philpott provided the membership with an update on the ongoing pension discussions. She has worked with PEI UPSE since 2006, focusing mainly on the public sector employees’ group insurance plan file. She has extensive experience advising unions on pension benefit matters. Susan has been involved in the pension discussions since they began in June of 2012. Government had approached the unions (PEI UPSE, CUPE, IUOE and the PEI Nurses Union) and the PEI Teachers’ Federation to advise of significant funding shortfalls in the Civil Service Superannuation Fund (CSSF) and the Teachers’ Superannuation Fund (TSF), and to seek their cooperation and input in exploring ways to address and assure the future stability of the two pension funds.

PEI UPSE agreed to participate in the discussions which began on June 26th and 27th, 2012. A working group comprised of government and union/federation representatives was charged with exploring alternatives and possible changes to the CSSF and TSF to ensure the sustainability of the plans. The working group will be asked to make recommendations to the Pension Steering Committee. The Steering Committee is made up of union Presidents, Minister Sheridan and members of his senior staff. At this point it appears that government may be willing to act on recommendations from the Working Group and the Pension Steering Committee. However, government has the power to impose changes they feel are absolutely necessary.

The union has made efforts to keep the membership up-to-date on the pension issue at large:

• August 2011 letter to members informing them that government may have been considering options such as reducing pension benefits to gain better control of the provincial finances.

• An article in the Fall 2011 Advocate discussing the CSSF and following up on the August 2011 letter.

• An article in the Spring 2012 Advocate informing members that government had approached the union’s to discuss the state of the public sector pension plans and the fact that a significant funding shortfall existed. The article informed members that discussions were being planned that would commence on June 26th and 27th, 2012. The objective of the discussions is to explore possible changes to ensure the sustainability of the plan. The union also informed members at this time that it had hired Susan Philpott to aid PEI UPSE in the forthcoming discussions.

• August 2012 letter to members providing an update on the pension discussions. The letter also stated that the Unions retained an independent actuary to advise on the soundness of the pension plan valuations thus far, assess any proposals from the Government and advise the unions as to the best and most cost-effective way to spend our pension dollars

• An article in the Fall 2012 Advocate informing members that the Pension Working Group had participated in three meetings with no defined deadline for the discussions. The meetings were described as preliminary and aimed at achieving a better understanding of the CSSF with an objective to determine the best way to sustain the plan with the least cost to contributors and pensioners. The update also stated that the union-commissioned actuarial (Clare Pitcher of Buck Consultants) had asserted that pension stability can be achieved without extraordinary changes to the current plan, and

• Susan Philpott’s presentation/update to the membership at the union’s 51st Annual Convention (see Susan’s presentation posted on the PEI UPSE website).

In these communications we have provided information on the pension plan and key happenings in the pension discussions. Please check the pension section on the PEI UPSE website at www.peiupse.ca for detailed information.

Since the initial pension discussion in June, there have been three sets of meetings:

• At the June 25th and 26th meetings, the working group received further education on the state of the plans and the distribution of liabilities

• At the August 15th and 16th meetings, the working group was informed of the Plan’s investment practices. Also discussed were joint governance models for public pension plans and the recent changes to the public sector pension plan in Nova Scotia; and,

• At the most recent meeting, on October 25th and 26th, the working group listened to two presentations about the new “New Brunswick model.”  The first presentation was delivered by the valuator employed by the government, while the other was delivered by representatives of public sector unions in New Brunswick involved in the redesign of their plans according to the “New Brunswick model”.

In conjunction with the October meetings, representatives of the five PEI public sector unions/federation met, independently of government, to determine a concerted position on a government request to increase the individual pension contribution rate. At the meeting, the parties agreed to support a contribution increase of 1% given that government agrees to increase its contributions by the same amount. Government is likely to proceed with an amendment to the Civil Service Superannuation Act to implement the increase in the Fall sitting of the legislature.

UPSE’s position at future talks will be:

• To regard the CSSF as a plan that requires some review but should not be regarded as a plan that is in crisis.

•If future changes are made to the plan they should be minimal.

•That solidarity is important: PEI UPSE will continue to maintain its coalition/consensus among the unions/federation.

The next meeting of the working group will be held on November 22nd and 23rd and will include participation from members of the Pension Steering Committee which is leading the pension initiative. The objective of this meeting is to define the agenda for any further discussions on changes to the pension plan.


Deborah Bovyer


PEI Union of Public Sector Employees