Pension reform advocate drops by St. John’s

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Bill Tufts, an employee benefits and pension specialist based in Hamilton, Ont., says public-sector pension plans in Newfoundland and Labrador are not built to last.

Bill Tufts, an employee benefits and pension specialist from Ontario, was in St. John’s Wednesday to meet with Memorial University students. — Photo by Andrew Robinson/The Telegram

“At one time, those promises seemed reasonable. They’re no longer reasonable,” he said Wednesday to a small group of students at The Breezeway on Memorial University’s St. John’s campus.

“They are going to be funded by people that aren’t getting those promises themselves.”

He was a guest speaker for an event organized by Generation Screwed, a group aligned with the Canadian Taxpayers Federation that’s advocating for reduced debt load and small government. Tufts is the founder and executive director of Fair Pensions for All.

Tufts suggests the cost of defined benefit pension plans in the public sector is too great for future generations to be burdened with and leaves retirees excessively entitled.

“There’s an issue of fairness around that, especially when we’re living longer and your generation is going to be paying those costs for so much longer.”

He said when pension plans were created in the early 20th century, they were intended to keep seniors out of poverty. Today, such pensions have become much more lucrative, according to Tufts.

While in St. John’s, Tufts said he met with provincial Finance Minister Charlene Johnson and city officials.

Organizations: The Breezeway, Fair Pensions for All.Tufts

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Recent comments

  • Agree
    March 28, 2014 - 09:12

    DARREN ... Not sure if the liability is if everyone retired today. I think it is the money to be paid out to pensioners in the future til they die. Therein lies the problem. Govt doesn't explain it. Govt' latest pension report 2007 shows 190M was paid out tp PS pensioners. That's a far cry from 7.3B.

  • John
    March 27, 2014 - 17:01

    DARREN You said it all man ! Just what I was thinking ! Great job

  • jen
    March 27, 2014 - 14:23

    Way to go Darren FINALLY someone who knows what is really going on...although a spell check would have been nice! :)

  • Angus
    March 27, 2014 - 12:28

    I have a question for someone. If a retired person returns to the workforce while still collecting a CPP and OAS the what happens to the EI premiums, CPP contributions and Worker's compensation contributions that would be deducted if that person were working without pensions as a younger person? As one is retired they are not eligible for further increases in CPP, they can't draw EI and after 65 you are automatically ineligible for Worker's Compensation if injured on the job. Another question is "Does the employer have to contribute to these programs on behalf of that pensioner or is this another subsidy which low paying employers receive when they hire a pensioner?"

  • Darren
    March 27, 2014 - 12:16

    This guy is a specialist?? Average PSP of $37,000...... Are you kidding me.... CPP is clawed back Sir, not added. Pensions do need some reforms, no doubt about it. However, the issue of an unfunded liability is more about a play on words than factual. In accounting you must accrue your liabilites. Therefore, the unfunded pension liability represents the amount that would have to be spent today if everyone retired today!! That cannot happen. What I see a reforms are more to do with eliminating the opportunity to all contributors to the PSP to take a commuted value of their pension. In my own case, if I were to quit today I could take a full commuted value of my pension (~$75,000) and do whatever I want with it. I could also take the communted value of my employers portion and invest into an annuity. Therefore, as of today, I represent $150,000 of the total "UNFUNDED LIABILITY". If this option were eliminated accross the board, you would be the value of the liabilty drop dramatically. Seconded, an independent accessment should be done to dtermine the value with interest the amount of money that government robbed from the plan anc never repaid - in order to build roads and bridges; and also the value with interest for the period in which govenment did not contribute the 50% portion for thier employees. Finally, why were certain individuals allowed to enter the plan who never paid a single penny into its fund??? It is mandatory to enter into this plan when you are hired - and now we are gonna be blamed for its poor condition?? Government should be sued for neglienace in managing the PSP fund. May be a case for a class action here - we can have one for everything else. We should also be boycotting the outspoken members of the business community who are behind this moment. Some of them don't mind hiring employees to perform cash work on personal projects of theirs!! Wait until summer when you can see their huge trucks with company logos, towing campers out of the highway or bringing lumber for an entension to their cabins. Guess, your company is paying for that truck, fuel and insurance, eh!!! The simpliest soluation, just given us back 100% of conttributions (both employer and employee) and let us be responsible. Then we will not have any clawback on CPP. We may even get a little GIS when eligable for OAS.

  • Ladybug
    March 27, 2014 - 11:22

    Mr. Tufts is nothing but a lobbyist, how ironic he spoke to students he is getting paid to stir up our future employers/employees. The question that should have been asked to him is? Sir if you worked for 25/30 years with the Public Service would you be able to live on the pension!!! I think not! These so called experts have no idea how the average pay person lived.

  • Retired Person
    March 27, 2014 - 10:25

    We know all about Bill Tuft. He is a mouth piece for those who are trying to reduce pensions for public servants. The federal public service pension plan is self-funded. He also does not support increases in CPP. But, if pension plan benefits are reduced aren't we going to need increased CPP benefits?

  • Agree
    March 27, 2014 - 09:43

    I think we can all agree the PSPP is in trouble. If you start in govt at age 20 and work to 55, I believe you contribute about 35, 000??? Then you could live another 25 on pension to average expectancy of 80. With average pension being 25-30,000, it doesn't take long to get your money back so it does need to be changed. Sadly the MHAs pension is even more lucrative but we don't hear much about that. I am amazed the "specialist" came out with these numbers. Did he talk to anybody in Finance??

    • Darren
      March 27, 2014 - 12:51

      Sorry there "Agree" but there is something wrong with your assessment!! If you contributed $35,000 over a 35 year work period, that would mean your yearly average income was around $15,000. PSP rates vary between 6.8% and 8.6%. The employer also pays the same. How is that you could then collect $25 to $30,000 in annual pensions????? To get a $30,000 annual pension over the 35 years you refer, you would need to roughly average $43,000 in gross earning per year.

    • Agree
      March 27, 2014 - 13:59

      Just checked my records and it was 53,000. Average income over 35 years is about 25,000 but pension is based on best 5 years. My point is that it doesn't take long to get your money back, less than 2 years. A plan like this can't take care of itself.

  • Keith
    March 27, 2014 - 09:43

    Public Sector unions are parasitic by their very nature and their days are slowly coming to an end. The reality is pension reform is a hot topic north and south of the border. This, along with the escalating costs of health care, are the elephants in the room. The Williams/Dunderdale administrations made the decision to forgo the opportunity to pay down debt, manage the expectations and size of public sector unions and create a fund that could be used in really lean times to stimulate the economy. Instead they are running deficits in the face of record revenues, grown the public service to the highest rate in Canada and are proceeding with an extremely risky project (Muskrat Falls). History will ultimately be the judge as to what approach would have been prudent. I truly hope they made the right choices however I fear the opposite to be true.

    • Saucy Face
      March 27, 2014 - 11:11

      So, you think they days of the Public Sector is coming to an end huh? Dream on my son, dream on. If thehe private sector was required to be unionised, everyone would have a decent pension, beause like the public sector both the worker and emploter would have to pay for one.

    • Tim Jamison
      March 29, 2014 - 10:30

      Saucy Face, if the private sector were unionised this country's economy would collapse, like Greece's did. There is only so much cream to put in everyone's coffee. Your ideal world leads to austerity plans that cannot be protested away. You haven't the slightest inkling of how economies work

  • Steve
    March 27, 2014 - 09:41

    How about a more accurate headline: Right wing stooge of the corporate elite drops by St. John's. It's not like this guy is an impartial analyst - he's paid to undermine everything in the public sector and boost everything in the private sector - low services, and low pay for most of us, high profits for big investors. Did the Minister or City Officials meet with anyone with a different view, or just this lobbyist?

    • John
      March 27, 2014 - 10:58

      Your choice of name calling indicates your in the organized labour camp. You may not like the messenger, but you can't deny that the message is important to acknowledge.

    • Gb
      March 27, 2014 - 18:36

      @john..he is acknowledging the message and the messenger. He is spreading inaccurate information on behalf of a group of employers who would increase their profit on the backs of hard working loyal Newfoundland and Labrador workers. Personally I have no respect for someone like that.

  • Irony
    March 27, 2014 - 09:07

    It's ironic that this guy is raising the ire of students by telling them that they're going to be paying for pensioners - the same people who are paying for frozen and zero interest student loans right now. HA!

  • Too Funny
    March 27, 2014 - 08:55

    This guy is funny because he gave his presentation to MUN students - a group very similar to public sector pensioners in that they both want a better ride on the taxpayers dime.

  • gb
    March 27, 2014 - 08:52

    This so called specialist should publish figures on how many pensioners are living on pensions of under 16000 a year.He also stated that the CPP is added to the pension when in actual fact the pension is reduced when the CPP kicks in..since he is a so called speccialist he would know this.He thinks a pension should keeo the elderly just above the poverty level. Actually a modern pension should keep the person in his standard of living and his life long contributions would relect this of course. I'm guessing if you could see who pays this mans his income then you will see why he is making these ludicrous pro employer statements.

  • Joe
    March 27, 2014 - 08:43

    Let's hope your socket is OK today. So here we go again "an employee benefits and pension specialist" says who, Mr. Tufts? Give me proof that he can run a pension plan. I'll bet he's an expert because he only comments on others pension plans. Many plans both public and private are in poor shape because of the expertise of these pension experts. Just maybe we should fire them and hire advisors and companies who can actually manage a pension fund. The Managers of the CPP seem to be capable of the job. Why not roll all pension plans into the CPP and do away with private pension fund managers all together. It's about time that the media gave less exposure to these Right Wing fringe groups in stead of treating them as if they were the MAJORITY.

    • Chris
      March 27, 2014 - 09:58

      Why would the CPP want to take on the pension liability that these plans have created. Mr Tufts is just telling you the way it is! Look at Detroit, if I had my way I would vote in government that would go right after these pension plans and stop using my tax dollars to fund your benefits. Its only a matter of time Joe!

  • Joe
    March 27, 2014 - 08:18

    There are too many government workers in the province and salaries are way too high. Taxpayers will suffer big time in 10-15 years from now when we have to pay these retirees. All of the people who are whining are too uneducated to realize whats going on. Most of these pensioners are very rich when you consider that most have no mortgage on a house that tripled in value from when they bought it 30 years ago. The young non-goverment workers in the province are do not have it easy. I think most of these pensioners have the fish merchant mentality because they are the rich ones and the young private sector workers are they poor working class.

    • Saucy Face
      March 27, 2014 - 10:03

      Rich? Live on my so called rich pension my ignorant friend and see how rich you'll feel.

  • Barney
    March 27, 2014 - 07:50

    And so now he wants to put retirees back into poverty? With the cost of living the way it is you have to have a good pension. I'm o.k. with not having one that I'm forced into as you are with the PS and investing myself. I may have a chance when I do retire but right now the PS is taking my money without my say and spending it on the province and not investing it as they is that fair?

  • edwartt
    March 27, 2014 - 07:13

    If he really cared about pension fairness for all then why is he not going around demanding all business have a pension plan . At least a vested RRSP type plan which you can't get at until your 60 at least. And improve the CCP and most experts have said is the easiest solution as it is already set up. They you can adjust the government plans to make them a little more reasonable . I believe these right wing guys solution to pension fairness is no pension make the peasants work until they drop dead so the rich companies can keep wages down and people work longer in the minimum wage jobs.