Today the Public Service Pension Plan announced a decision to use surplus funds in the plan to improve the value of your pension. We wanted to write to you in full support of the decision, and to explain it in clear terms.
This decision comes from years of advocacy by your union to improve the value of your pension. In 2018, the pension plan moved to a flat rate of accrual at 1.85% of annual salary, removing unfair subsidies and significantly increasing the value of the average BCGEU member's pension. One of those subsidies that was removed on a go-forward basis was the "bridge" to Canada Pension Plan (CPP) at age 65, which was valued at 2%. While most members were a better off under this arrangement, the difference in the bridge negatively impacted a small number of members who benefited from this subsidy by retiring on or close to the earliest retirement age of 55.
The announcement today means that as of April 1, 2022, the flat rate of accrual will move up from 1.85% to 1.95%. This will bring the accrual rate to only 0.05% below the former bridge amount, but unlike the former bridge does not end at age 65, and extends for the duration of your pension.
This is a significant win for BCGEU members, and something we fought for when the 2018 pension changes were announced. We are pleased that due to the good financial health of the plan, the surplus is being used not only to improve the value of your pension, but also to stabilize contribution rates for years to come.
Paul Finch, BCGEU Treasurer
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