CITY COUNCIL APPROVES GENERAL PENSION PLAN CHANGES

For Release: September 22, 2014

Due to uncertainty surrounding City finances and the future of the General Pension Plan, at a special meeting City Council today approved necessary changes to the Plan.

The changes mean employees and the City will each contribute more to the Plan to ensure it lasts well into the future.

There are nine unions which participate in the General Pension Plan; eight have already reached agreements with the City while the Amalgamated Transit Union, 615 (ATU) has not.

“We have a responsibility to the other eight unions and nearly twenty-two hundred employees who have signed onto the new plan,” Director of Human Resources Marno McInnes says. 

“We have promised City employees that the plan will be there when they need it and City Council has kept that promise.”

The Plan valuation was not up for debate.  The Plan deficit has already been triple checked and verified by a third party review – required under provincial law.  This analysis had been accepted by the City and its unions.  In fact, the valuation formed the basis of the agreement to fix the pension plan every other union has agreed to except for the Transit union.

Saskatoon Transit operations remain suspended following a Saturday lockout of the Transit union.  This, after the union demanded in last-minute bargaining talks a 22% wage increase over five years.

“The pension issue has been settled and the Transit union’s latest wage proposal is not fair to the eight other civic unions which settled for 10 per cent,” McInnes says.  “We hope the Transit union can find a way back to the negotiating table so that our transit operations can return to normal.”

Previously, the City and the Transit union had been at an impasse on the union’s portion of the City’s General Pension Plan which was valued with a $6.7 million deficit.

The issue became an urgent business matter for City Council. The provincial government regulator – The Superintendent of Pensions – last week issued a letter to the City directing the City to pay $90,100 per month starting at January 1, 2014. 

The changes will pay-off the deficit by increasing the contributions of both employees and the City.  The changes will also create a 10% cushion in the fund to absorb any future volatility in the financial markets.

“If Council did not take this bold step, every month that went by without a contract would have cost taxpayers $90 thousand, or just over $1 million per year,” McInnes says.