NB pension changes look like a step in the right direction - but devil's in the details

MONCTON, NB, June 1, 2012 /CNW/ - The Canadian Federation of Independent Business (CFIB) is meeting New Brunswick's changes to public sector pension plans with guarded optimism.

"Finally, we have a government acknowledging that status quo, defined benefit public sector pension plans are unsustainable. And they've clearly done that," said Leanne Hachey, CFIB's Atlantic vice-president. "The massive challenges facing these plans are detailed admirably by the task force and echo what we've been saying for years."

Some positive changes include increased transparency, the removal of automatic indexing, bringing the age of retirement in line with the private sector and an end to the one-off top ups that have been a regular feature of public sector plans.

In fact, a just-released CFIB report Canada's Hidden Unfunded Public Sector Pension Liabilities figures Canadians have injected an extra $1.27 billion per year into these plans between 2001 and 2010.

However, there are also lots of questions and some concerns with the changes, which include the lengthy transition period of 40 years, as well as increased cost to taxpayers to fund the new plan.

"If it's truly being billed as a shared-risk plan, why would taxpayer contributions need to increase more than employee contributions?" asked Hachey. "We will be working to find out what these changes really mean over the next days and weeks.

"We'll also be asking governments across the country when they'll start making similar reforms."

To read CFIB's recommendations to the Task Force, visit: http://cfib.ca/a3359e

As Canada's largest association of small- and medium-sized businesses, CFIB is Powered by Entrepreneurs™. Established in 1971, CFIB takes direction from more than 109,000 members in every sector nationwide, giving independent business a strong and influential voice at all levels of government and helping to grow the economy.


SOURCE CANADIAN FEDERATION OF INDEPENDENT BUSINESS

For further information:

or to arrange an interview with Leanne Hachey please contact Jocelyn Mattatall at 506-855-2526 or email public.affairs@cfib.ca

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