The City of Fredericton should move to a shared-risk pension plan for its employees, a committee will recommend to council at a special meeting on Monday night.
The committee has been reviewing the matter for about four months and believes a shared-risk model will benefit everyone, according to Coun. Mike O'Brien, the chairperson of the city's superannuation board.
"The amount that you're contributing is known up front for the employees," he said.
"It's also known for the city, which is great for budgeting because now we can predict how much we have to put in each year as opposed to wondering — do we have to sit down and negotiate with all our unions again next year."
O'Brien says four out of six employee groups with the city are supporting the new plan.
The two remaining unions — firefighters and police — were expected to discuss the matter over the weekend, he said.
The police union wants the city to slow down, said Andrew Dawson, spokesman for Local 911.
It has filed a complaint to the New Brunswick Labour Relations Board for an injunction to prevent the city from carrying out its proposed changes.
"We would agree that a sustainable pension plan is a paramount concern to everyone involved, but I'm a big believer in trust but verify, and I think the taxpayers and the City of Fredericton should trust and verify as well," Dawson said.
"Verify the city's facts and information before we ram changes to the pension plan at city hall, tonight," he said.
The lLabour and Relations Board will hear the police association's complaint on Wednesday.
O'Brien says the unions have had plenty of time to discuss the problems.
The city's pension was underfunded by about $59 million during its last valuation and now is the time to act, he said.
"The key changes are that the retirement age, that you can retire without a penalty, goes up five years, so our typical employees now, if they have the required years of service, can retire at 60, and fire and police can retire at 55. Those both go up five years to 60, and 65."
If the changes go ahead, future retirees will also see a 10 per cent drop in their base pension.
Council will discuss the so-called Bylaw Respecting Administration and the City Council at 5:30 p.m.
Saint John adopted shared-risk model
Premier David Alward unveiled a shared-risk plan for provincial government employees last May.
Under the plan, the age of retirement will be moved to 65 from 60 over a 40-year period, contribution levels will increase and cost-of-living increases will be conditional on the plan's performance.
Saint John switched to the shared-risk pension plan on Jan. 1 on the advice of Susan Rowland, the chairperson of the provincial pension task force. The city's pension deficit had been estimated at $195 million.
Rowland has said she believes all municipalities should join a province-wide, shared-risk pension plan.
It would protect pensions for workers and offer stability to employers by cutting administrative costs and offering better investment opportunities, she has said.
There are already 44 medium and small New Brunswick municipalities sharing a single pension plan.