Bovyer says CFIB interested in race to bottom on pensions
Posted: June 19, 2013
The President of the PEI Union of Public Sector Employees, Debbie Bovyer, disagrees with the Canadian Federation of Independent Business (CFIB) report that calls for an end to the “bridge benefit” provincial public employees are eligible to qualify for as part of their pension. CFIB’s director of provincial affairs, Erin McGrath-Gaudet, represents less than 20% of employers on the Island through her organization, and would like to see some 10,000 public employees in PEI lose approximately 1/3 of the value of their total pension.
President Bovyer says “McGrath-Gaudet’s suggestion is tantamount to saying the unions and provincial government, through the pension review process currently underway, should essentially ’gut’ the pension plan. If current workers were to lose their bridge benefit, then about 35% of their pension plan would disappear. There is no question that this would be devastating to public employees and to the local economy that they support every day.”
“Employees who participate in the province’s pension plan do not have a gold plated pension. The average pension for all retirees is below $17,000 a year. It is true that the pension fund took a hit as a result of the market collapse in 2008, however, as the economy improves so do the plan’s returns. Further, workers are now contributing more of their pay cheque to their pension in an effort to ensure the pension remains sustainable. A 1% increase in contributions in 2012 was not opposed by the unions given also that the employer matched the increase,” explained President Bovyer.
She further pointed out that “there will be less early retirement in the coming years as the average age of hire in the province is now thirty-seven, and workers need thirty years of service to draw a full pension. Further, those who decide to retire early are subject to a penalty resulting in a 3% per year reduction in their pension.”
“I think it would be great if the CFIB concentrated on how to help its relatively small membership get a pension plan, or perhaps support the idea to enhance the Canada Pension Plan (CPP) so that our seniors can retire with security and dignity. Unfortunately, they’re approach seems to be about creating a race to the bottom and pitting neighbour against neighbour.”
Please contact Mark Barrett at 892-5335 (or toll-free at 1-800- 897-8773) to arrange an interview.