Alberta can't afford pensions

[Argus]

Yet another fiscally incompetent government looking to blame its employees for its own incoherent budgeting policies.

Oil money has been pouring into Alberta for years yet it's still running deficits, worse ones every year. Because of public pensions? Nope. Because it's politicians have decided that the best way to reelection is by promising the herd that they can have their cake and eat it to. Alberta's Tories have been giving the public everything it wanted in every way it wanted while still holding taxes low and refusing to have sales taxes. "Sure, you can have this! Sure you can have that! No, don't worry about paying for it! We'll give you all that stuff and still not raise taxes! How? Because we're so good at this!"

Riiight. So while continuing to cut taxes for business, while keeping oil royalties very low so as to not harm the bottom line of the oil companies, they'll slash and burn their employees taxes and benefits packages and blame their own incompetence on greedy unions.

http://fullcomment.nationalpost.com/2013/09/17/kelly-mcparland-alberta-says-it-cant-afford-public-pensions-then-who-can/

[Shady]

No, it actually is public pensions. Similar problems in several states have already been taking place. States with high taxes. Because the problem is, no matter how high you push taxes, the public unions will push pensions and benefits accordingly. That's why Ponzi schemes like defined benefit pensions plans have to be scrapped, and public employees have to start contributing more to their retirements, instead of asking Joe Q Taxpayer to pick up the tab. Enough is enough.

Edited September 19, 2013 by Charles Anthony
deleted re-copied Opening Post

[scribblet]

I disagree defined plans should be scrapped. Take a look at OMERS in Ontario, they are very well managed.

Alberta has come up with a plan that will freeze benefit increases until 2021; reduce the rate of cost-of-living increases and set “targets” instead of guarantees; cancel early retirement incentives and reduce benefits for those who retire early; and allow the government to escape automatic improvements during tough times. It's a solution without doing away with the plan.

Cancelling early benefit packages is a good start, also raising the '80' factor would be another cost saver. I don't know what their factor is but I know some places have 75.. These things would save the plan quite a bit.

[Michael Hardner]

Even GM had a problem planning for their pensions, didn't they ? There seems to be a common thread here of upper management - public and private - kicking problems down the road too often.

[Topaz]

What are the thoughts of investing the pensions into the gas and oil sector or are they? Just look at the CPP, they are investing in many sectors and so far so good.

[Shady]

Even GM had a problem planning for their pensions, didn't they ? There seems to be a common thread here of upper management - public and private - kicking problems down the road too often.

Yes, legacy costs can be a problem when they get out of hand, no matter public or private.

[Argus]

Even GM had a problem planning for their pensions, didn't they ? There seems to be a common thread here of upper management - public and private - kicking problems down the road too often.

It's because they get rewards for short term policies, not long term stability. It's easy to run the pension plan into the ground, because it takes years before the problems emerge, by which time you're off to your rich reward. If you're a politicians, you're gone to your own very rewarding retirement pension, plus, in many cases, the payoffs various corporations promised you while in office in the form of various board directorships. If you're private sector, well, there really is no way to go wrong given compensation in the millions(or tens of millions) each year and golden parachutes if you're ever dumped.

In this case what you have is an incompetent Albertan government borrowing money for greatly increased spending each year while not budging taxes. That's basically the same issue as in Ontario, where lavish spending Liberals kept increasing spending each year far above the rate of inflation.

[Argus]

No, it actually is public pensions. Similar problems in several states have already been taking place. States with high taxes.

And if you check those states you find that in almost all cases the states signed agreements and then did nothing to set aside money for the future liabilities they had agreed to incur. This isn't rocket science, it's basic math.

[MiddleClassCentrist]

Even GM had a problem planning for their pensions, didn't they ? There seems to be a common thread here of upper management - public and private - kicking problems down the road too often.

GM had a problem with pensions because they said to the Ontario Provincial Government "We are too big to fail, let us not have to put as much money into them because we will be able to keep going anyways" Ontario said "We are stupid, ok."

Then GM did as they said they would... when times got tought it was doomed to require external support.

If Alberta can't afford their public pensions, it's because Alberta is being conned by the oil companies extracting resources in the province.

The Ontario Teacher's Pension Plan is one of the most successful plans when it comes to getting returns. Even they are in a deficit because of the artificially low interest rates being used to prop up the economy with consumer spending while big business lobbies to download costs onto the workers without paying them anything more.

[Bonam]

Because it's politicians have decided that the best way to reelection is by promising the herd that they can have their cake and eat it to.

Umm... what do you think a pension is? A promise to have your cake and eat it too, nothing more.

[The_Squid]

Umm... what do you think a pension is? A promise to have your cake and eat it too, nothing more.

That's simply nonsensical rhetoric.

[Argus]

Umm... what do you think a pension is? A promise to have your cake and eat it too, nothing more.

A pension is a promise to forego salary, to contribute it to a retirement fund. You are supposed to contribute a given amount each month, as is your employer. The problem has been the employer has been failing to live up to his legal commitments.

So sure, Bonam, let's blame the worker.