St. John’s council to vote on pension changes

Josh Pennell
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Current plan doesn’t require member contribution

Danny Breen — File photo

St. John’s city councillors will debate and vote on possible changes to their pension plan at the regular council meeting tonight. The options being proposed come following a commitment by council to review the pension plan, as well as financial consulting from the company Morneau Shepell.

Coun. Danny Breen, who chairs the finance and administration committee — says the main issue that needs to be addressed is the pension plan as it exists now doesn’t require councillors to contribute.

“It’s been an issue for quite a while that the plan was non-contributory. I think all councillors felt we should be contributing towards the pension arrangement,” he says.


The plan in place now sees councillors get 20 per cent of their salary after two terms, 40 per cent after three terms and 60 per cent after four terms or more.

But councillors don’t contribute anything to that fund. What they’ve come up with is a way for councillors to choose between keeping their current plan, but contributing towards it, or taking a whole other option that will be available to newly elected councillors.

Newly elected councillors won’t have the option of taking the old plan, but will be given six per cent of their salary to buy an RRSP if they so choose.

People currently sitting on council will have a one-time option Oct. 7 of this year to remain in the existing pension plan or transfer to the new arrangement.

If they keep the current plan, they will start to pay six per cent of their salary into it.

Those choosing to transfer will receive no credit for service earned under the current pension plan, and no option to transfer back to the current pension plan.

“The whole idea is you have to recognize the service that’s been approved by the existing councillors. You don’t just cancel the plan,” says Breen.

This method means at some point the current pension plan will be completely phased out as no new councillors will be given the option of choosing it.

And giving people six per cent of their salaries once all is said and done means that there is no liability left for the city, Breen says. It also makes more sense to just give people the six per cent and let them put it into an RRSP if they so choose rather than putting it into an RRSP fund automatically, as councillors elected at the age of 72 or older can’t contribute to a personal RRSP, Breen adds.

In order for the changes to the pension plan to take place, there has to be a bylaw change. The proposed changes will be debated publicly and voted on at tonight’s council meeting.

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Recent comments

  • California Pete from NFLD
    July 09, 2013 - 13:00

    Why change they got it made. I DITTO all 3

  • Whaddaya At
    July 08, 2013 - 23:58

    St.John's City councillors don't contribute to their pension plan ?. How long have they been getting away with that ?. Those old farts have the audacity to take my tax dollars to spend when they finally leave their plush seats at The Bunker ?.

  • Dee
    July 08, 2013 - 20:39


  • Dee
    July 08, 2013 - 14:59

    You councilors make me sick,you sit there do nothing for residents but think you know it all,most of you already have the biggest kind of pensions,time to step aside and let someone else have a job who don't have an income but then again you are all so greedy,we never heard so much about Carrick Drive and the traffic problems until Mr Breen got in,never mind about all the other streets in St John's. As long as area is taken care of.Why don't you all join the mall walkers if you are looking to do something with your time.