Retirees hire lawyer to fight pension reforms
Pension Coalition says switching civil service plan to shared-risk model is unfair
A group of retired New Brunswick public servants has hired a Toronto lawyer to help fight changes to the civil service pension program.
Pension Coalition NB, which is made up of hundreds of retired provincial government workers, has brought in pension rights lawyer Ari Kaplan.
Kaplan, who has had success fighting pension changes in New Brunswick before, says the government's latest proposal of a shared-risk model is unfair.
"The issue is how to fairly distribute the risk among all people that would be contributing. And most of that risk has already been borne by the pensioners, given that they've worked their lives — 30, 40 years — to earn these benefits," he said.
Under the current plan, retired civil servants are sheltered from any risk of market downturns by the provincial government with guaranteed cost-of-living increases.
Under the reforms, announced by Premier David Alward in May 2012, the risk would be shared by both sides.
The proposed model also includes increased contribution levels and higher age of retirement phased in slowly.
Retirees maintain it's not fair to change their benefits retroactively.
Clifford Kennedy, a coalition member, says that while relations with the government have improved, the group is not ruling out legal intervention.
And that's something the provincial government would no doubt like to avoid coming into an election year.
"Our members are expecting that those rights will be respected," said Kennedy, 62.
"This individual [Kaplan] is the one that pleaded the case, Quinn vs. NB and won," he said.
"[Court of Queen's Bench Justice William] Grant came out and said that it is illegal for government to go out against retirees and take away their benefits."
Grant had said the primary purpose of cost-of-living adjustments "is to protect retirees from inflation because of their vulnerable circumstances arising from the fact that upon retirement their income is otherwise fixed and they are no longer able to bargain better remuneration to counteract inflation."
Grant directed the committee that oversees the pension plan for the New Brunswick Nurses Union and the New Brunswick Union of Public and Private Employees to refrain from making adjustments to cost-of-living adjustments for retirees.
The Pension Coalition has been vocal in its opposition to the proposed shared-risk model. Hundreds of members attended a series of heated public meetings about the reforms last spring.
Many people at the meetings warned Finance Minister Blaine Higgs they will punish the Alward government at the polls in next year’s election if the changes go forward.
The finance minister, who held information sessions in seven cities over four days in April, has acknowledged pensioners' concerns and apologized that the government did not effectively communicate the changes to retirees.
However, Higgs has also said the current plan is not sustainable. He’s dealing with a situation where some people may now be retired longer than they actually worked for the provincial government, he has said.