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Fourth Issue: June, 1993.
PENSION NOTES
ASSOCIATION PRESIDENT DISCUSSES PENSION ISSUES AT SPRING MEETING
At the Association's meeting on April 22nd, Norm Shklov, President, reviewed for the membership the current pension issues. His message was as follows:
Currently, the University and the Faculty Association are negotiating a new three-year contract. The Pension Plan forms part of the contract.
Proposals for change submitted to the Negotiating Committee of the Faculty Association were the following. Shklov emphasized that these were proposals made, not necessarily final points of agreement.
1) The adjustment to the Minimum Guaranteed Benefit each Plan Year to be:
(a) the cost of living increase up to 3%, plus
(b) half the increase in the c.o.l. above 3%.
The cost of living to be, as before, measured by the Consumer Price Index (CPI) for the previous Plan Year.
Under that provision, the increase in the Minimum Guaranteed Benefit could not be more than 1/2 of 6%, or 3%.
In the current (1990 to 1993) contract, the adjustment has been one half the increase in the CPI up to a maximum of 6% increase in CPI.
2) The amount of the Minimum Guaranteed Benefit to be equal to: (a) 1.45% of the member's Best Average Earnings not in excess of the average Canada Pension Plan Base, plus
(b) 2.0% of the member's Best Average Earnings in excess of the Average Canada Pension Plan Base, multiplied by the member's Pensionable Service.
At present, the percentage under (a) is 1.25%. The proposed figure represents a considerable increase in Minimum Guaranteed Benefit.
3) Retired members employed at the University before 1955 would have their pensions (or the pension of their surviving spouses) increased to reflect the full number of years of service before 1955. At present, only one half of the years of service before 1955 are credited to these people.
4) Any retired members with twenty-five or more years of service at the University, whose pensions (or the pensions of their surviving spouses) from the University are less than $1500 per month, would have their pensions increased to $1500 per month commencing July 1, 1993, and indexed to the cost of living thereafter.
5) Women faculty and librarian members who have fewer years of pensionable service than their years of employment as probationary and tenured faculty would warrant, would be given full credit for such service on retirement.
Shklov pointed out again that these are proposals the Negotiating Committee agreed to put before the University Administration.
Proposal (1) above is of utmost importance. Inflation quickly erodes the purchasing power of the dollar, and it is essential that pensions be indexed so as to increase, as closely as possible, with increases in the cost of living, as measured by the Consumer Price Index. A one-page simplified example, prepared by the Retirees' Association, was given out at the April 22nd meeting. A copy is included at page 7 of this issue.
Proposal (4) above originated with the Contract Comm. in answer to a question, "Are there any retirees who are very hard up financially?" The answer is not clear. To find out, the Ret. Ass'n. is considering the possibility of a strictly confidential survey of its membership. More on this possibility later.