Accordingly, effective January 1, 2016, the pension indexing increase for public service, Canadian Forces, RCMP, and federally-appointed judges’ pensions will be 1.3%.
Information on the calculation of this index can be found on the Public Works and Government Services Canada website at :
www.tpsgc-pwgsc.gc.ca/remuneration-compensation/services-pension-services/pension/pubs/pens-annts-01-index-eng.html#pens-annts-01-s6

“We will not be moving away from the current defined benefit plan to a defined contribution plan, target benefit plan, or any other shared-risk model,” states the Prime Minister. “The public service pension plan is solid and fully-funded, and there is no need to make any such changes. These are the facts.”

Our national political parties have all now committed to honouring pension promises to federal employees and retirees. Federal Retirees expects our next federal government to embed those promises in legislation, regardless of who ultimately wins the October 19 election and forms government.

Read the full letter here.

The Conservatives’ open letter focuses on the federal public service and does not specifically mention veterans. We’re working to clarify that. You’ll also note that the open letter is silent on the Public Service Health Care Plan matter. The Association is still in the process of seeking a declaration from the courts on that matter.

More on the promises the political parties have made to public servants over the course of the 2015 federal election are found in this Ottawa Citizen article.

Federal Retirees looks forward to the work ahead – ensuring the parties’ election promises are honoured and that Canadians’ retirements remain secure.

Federal Retirees would like to express our heartfelt gratitude for all that Canada’s seniors have accomplished.

We’re wishing you all a happy, healthy National Seniors Day, and we’re looking forward to all that Canada’s seniors will contribute and achieve in the years to come!

“The Canadian Coalition for Retirement Security believes a promise is a promise,” says Coalition spokesperson Jean-Guy Soulière. “A deal is a deal – governments and employers should not be allowed to go back on the promises and commitments made to millions of Canadians, including veterans, police and other loyal public servants when they were working.”

The campaign is being launched in response to the federal government’s plans to introduce target benefit or shared risk pension plans to Crown corporations and federally-regulated employers. Target benefit or shared risk plans provide a base monthly pension at retirement with limited or conditional indexation – all of which may be subject to change based on the plan’s financial performance. This is not what retirees were promised.

“Pensions are deferred compensation which employees pay for while working, and which an employer agrees to pay its employees upon retirement in return for the services rendered by those employees,” adds Soulière.

The Canadian Coalition for Retirement Security believes that no employer, in either the public or private sector, should be allowed to change the compensation promised to people once they have retired. Together, the Coalition is calling on Canada’s next federal government to take steps, including legislation, to protect Canadians from this threat to retirement security.

The Canadian Coalition for Retirement Security knows that Canadians stand firm in their belief in honouring pension promises. In June 2014, Ipsos Reid found that while a substantial proportion of Canadians (44%) recognize the difficulty employers may have in providing pensions for their employees and pensioners, many more — more than nine in ten Canadians (94%) – agree that employers should live up to the commitments they have made to pensioners and employees. And Canadians are clear that they expect their governments to make sure this happens: 92% agree that in developing any new pension framework, governments should ensure that employers honour the commitments made to pensioners and employees.

The Canadian Coalition for Retirement Security is comprised of 22 organizations, associations, veterans groups, unions, and seniors groups that share a common vision – that public and private sector employers must honour existing pension commitments to pensioners, veterans, and employees.

• Aboriginal Veterans Autochtones
• Air Canada Pionairs
• Armed Forces Pensioners’/AnnuitantsAssociation of Canada
• Bell Pensioners’ Group
• CanadianAssociation of Retired Teachers
• Canadian Association of Veterans inUnited Nations Peacekeeping
• Canadian Federation of Pensioners
• Canadian Labour Congress
• Canadian Merchant Service Guild
• Canadian Naval Air Group
• CanadianPeacekeeping Veterans Association
• Canadian Union of Postal Workers
• CBC Pensioners National Association
• Congress of Union Retirees of Canada
• Council of Senior Citizens’ Organizationsof British Columbia
• Maritime Aviation Veterans’ Association
• National Association of Federal Retirees
• National Pensioners Federation
• Newfoundland Coalition of Pensioners,Retirees and Seniors Organizations
• Public Service Alliance of Canada
• RCMP Veterans’ Association
• The Professional Institute of the PublicService of Canada

For more information please contact:
Sayward Montague
Chair, Canadian Coalition for Retirement Security Steering Committee
smontague@fsna.com
(613) 404-4554

We are thankful for Sylvia’s dedication and outstanding contributions over the past six years to the Association’s members, stakeholders, partners, volunteers and staff.  With her determined and tireless efforts, Sylvia has successfully managed the many demands of our organization, and was instrumental in recruiting an excellent senior staff team.  Under Sylvia’s leadership and prudent fiscal management, the Association has experienced an exciting growth in membership and revenues that bodes very well for the future of the organization.

Although Sylvia is moving on to new challenges, the National Association of Federal Retirees will continue to benefit from the positive legacy she leaves behind. We wish her all the best.

Mrs. Debbie Bernhardt, current Director of Finance and Administration, will be the acting CEO until a new CEO has been appointed.

The Board, heedful of the fact that only members can elect the president and vice president, have appointed Ottawa District Board director Mr. Konrad von Finckenstein as chair of Board with the powers of the president until a new president and vice president are elected by the members at the 2016 Annual Meeting of Members.

Konrad will assume his duties as of September, 2015.

“Our members served their employers with honour and dedication during their careers. Canada has benefitted, and continues to benefit immensely from the hard work of public service employees,” says Gary Oberg, National President of the Association. “So this week, the National Association of Federal Retirees would like to thank Canada’s public service, both past and present, for their extraordinary contributions, every day, in every part of this country.”

The National Association of Federal Retirees, formerly known as the FSNA, is the largest national advocacy organization representing federal retirees, their partners and survivors, from the Public Service of Canada, the Canadian Forces, the Royal Canadian Mounted Police (RCMP) and retired federally appointed judges. The National Association of Federal Retirees is a not-for-profit association with more than 185,000 members, with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

Many of you pitched in when you sent letters to your MPs and signed petitions after the Treasury Board announced an increase to your Public Service Health Care Plan premiums. Despite our efforts, the federal government increased the retiree cost-sharing ratio from 25 to 50 per cent.

The National Association of Federal Retirees has directed the firm Gowling Lafleur Henderson LLP to take the necessary legal action to protect your rights and interests. A Notice of Application has been filed with the Federal Court of Canada on behalf of the Association and some of its members.

While we continue to oppose the changes to your PSHCP contributions through legal channels, your Association is also mounting an advocacy campaign to strengthen political and public support for the protection of retiree pensions during the 2015 election campaign.

We need your support — now more than ever before.

Many of you have contacted our national office to volunteer your help in the fight for your pensions and benefits, and we thank you. Many of you have offered to make a financial contribution to our legal fund and advocacy campaign. We’re now able to accept those contributions.

If you wish to contribute, please visit our online store  or call our national office at 1-855-304-4700. All contributions will be used to assist the Association with legal and advocacy campaign costs.

As a not-for-profit advocacy organization, we are only as strong as our people. The larger our Association grows, the stronger our voice becomes — and the more effectively we can speak out for federal retirees.

Please encourage your friends to join our Association as we continue to fight for your pensions and benefits. It’s as easy as clicking here.

We also encourage you to contact our office — service@federalretirees.ca or 1-855-304-4700 — and provide us with your email address so that we can keep you informed and equipped with tools you can use to help us in the fight to protect your retirement.

The National Association of Federal Retirees is not a charity, and we are therefore unable to provide a tax receipt for your contribution.

By Alan Freeman

Alan Freeman, former Globe and Mail finance reporter and Assistant Deputy Minister for Consultations and Communications with the federal finance department under the late Jim Flaherty, reports from the 2015 budget lock-up on behalf of the National Association of Federal Retirees and iPolitics. In the coming weeks, the Association will provide in-depth analysis of the budget and what it means for federal retirees. Note that the figures for Registered Retirement Income Fund (RRIFs) mandatory withdrawals have been corrected.The federal government reaffirmed its intention to continue its study of target-benefit pension plans.

Finance Minister Joe Oliver, in his first budget since taking on the portfolio, said Tuesday that the government “continues to assess a voluntary target benefit option” for Crown corporations and federally-regulated businesses like banks, broadcasters and railways.

However, the budget aimed to reassure active members of these plans and retirees.

“The government understands the importance of ensuring that any changes to the federal pension regime protect benefits that have already been earned by requiring that plan members and retirees consent to the treatment of accrued benefits at the time of plan conversion.”

A government official wouldn’t elaborate on the kind of consent being contemplated, saying the consultations are ongoing. In New Brunswick, which adopted the nation’s first target-benefit plan in 2013, retirees were not consulted in advance on the new plan, prompting them to launch legal action challenging the legislation.

Some provinces are considering similar target-benefit plans and are mulling various formulas for consulting members, including a negative option for retirees, which would require 30 per cent of them to indicate their opposition for the measure to be stopped. Silence on the issue would effectively equal consent.

The official also repeated the government’s previously-stated intention not to proceed with the target-benefit option for the core public service.

While Ottawa indicated a go-slow on target-benefit plans, it continued its onslaught on sick leave and disability benefits for the public service. It booked a $900-million saving in the 2015-16 fiscal for virtual elimination of the bank of sick days in the core public service. It said it plans to negotiate a new disability deal with unionized workers but made it clear that if talks don’t turn out the way it wants, it will “take steps” to implement a new plan “within a reasonable timeframe,” a blunt threat to legislate.

The budget included a series of measures aimed at seniors, a key demographic for the Conservatives in the run-up to a federal general election, including liberalized rules for withdrawal of retirement income funds, expansion of tax free savings accounts, and measures to help disabled and gravely ill individuals.

Top among these measures is the decision to increase the annual amount of money individuals can invest in tax free savings accounts to $10,000 from $5,500. Although they are open to all Canadians over the age of 18, TFSAs have been particularly popular with seniors. According to the Finance Department, 1.9 million individuals contributed the maximum allowable amount to TFSAs by the end of 2013, of whom 46 per cent were seniors. The measure will cost the government $85-million a year in 2015-16, rising to $360-million in four years’ time.

The TFSA changes are due to come into effect in 2015.

The government said it plans to reduce the minimum required rate of withdrawal of funds for seniors who hold Registered Retirement Income Funds (RRIFs). Currently, Registered Retirement Savings Plans (RRSPs) must be converted into RRIFs by the end of the year when the senior turns 71 and a minimum amount must be withdrawn every year that follows. The rate currently starts at 7.38 per cent at the age of 71 and rises to 20 at age 94.

Because of lower investment returns and to make sure seniors’ capital doesn’t run out with longer life spans, the withdrawal amounts will be reduced to 5.28 per cent at age 71, rising to a maximum of 20 per cent at age 95.

For somebody who starts with a $100,000 fund, it means that they will still have $24,000 in capital at age 95, compared with just $15,000 under the current regime. The new rules are due to come into effect for the 2015 tax year.

The measure is unlikely to have a major impact on retirees like federal public servants who spent their entire career in a workplace offering a substantive defined-benefit pension plan because they had little tax space available for RRSPs.

Also included in the budget is up to $37-million for an extension of compassionate care benefits available under employment insurance system. Currently, an eligible family member who is providing compassionate care to a loved one who is dying or at risk of death can receive up to six weeks of EI benefits. That will increase to a maximum of six months under the new scheme.

Fewer than 6,000 people received the benefit in 2011-12. An official conceded that the new program will still benefit only a relatively small number of Canadians with much of the extra money likely to go to an extension of the time that carers receive EI rather than a substantial increase in the number of beneficiaries.

The government also announced a new home accessibility tax credit for seniors and people with disabilities. The proposed income tax credit would allow a taxpayer to claim up to $1,500 in annual federal tax relief for home renovations like walk-in bathtubs and wheelchair ramps allowing them to remain in their homes.

To qualify for the maximum $1,500 credit, a taxpayer would have to spend $10,000 on renovations. It comes into effect in 2016.

The credit can be claimed by relatives of the qualifying individual if certain conditions are met.

On behalf of the Association, our members and our staff, I would like to take this opportunity to say “Thank You” to all of our volunteers, for their commitment, dedication and their tireless efforts. Our Association continues to face challenges, transition, and change. Together we will work diligently to be stronger and better positioned to meet and overcome upcoming challenges and we couldn’t do this without our volunteers.  They are the lifeblood of this Association and we thank them for all that they do!

“Those who can, do. Those who can do more, volunteer” Author Unknown

Gary Oberg
President
National Association of Federal Retirees

The new contribution rates will be taken from the March 30, 2015 pension cheques.

 Click here for details.

As of April 2015, part-time reservists will be eligible for the Earnings Loss Benefit on the same basis as full-time reservists. To date, part-time reservists have not been eligible for the same kinds of benefits as full-time or regular force reservists.

“This has been a major concern with the New Veterans Charter since 2006,” says Gary Oberg, President of the National Association of Federal Retirees. “All veterans who sustain similar illnesses or injuries while serving their country should have access to the same benefits, regardless of the nature of their service – and today’s announcement from Minister O’Toole is a step forward on that.”

This issue of equality was identified by veterans groups, the Veterans Ombudsman, the New Veterans Charter Advisory Group, and two House of Commons reports as one of the most pressing issues facing veterans and their families today. In September 2014, the National Association of Federal Retirees raised this issue with the parliamentary finance committee as a budget priority for veterans.

The Earnings Loss Benefit is available to veterans who are injured in service of Canada and lose income as a result, and who also participate in a Veterans Affairs rehabilitation program or who are unable to be suitably employed. Currently, the Earnings Loss Benefit for part-time reserve force veterans totals $24,300 annually. Full-time reservists are guaranteed a minimum $42,426 in pre-tax income for as long as they are in a Veterans Affairs rehabilitation program or if they are unable to work to full capacity.

“What remains to be seen is how this improvement will be implemented, and whether all of the veterans and families who need this support receive it,” noted Oberg. “In today’s announcement, Minister O’Toole said that no one will be left out – the National Association of Federal Retirees intends to ensure the Government of Canada honours that promise.”

A number of other deficiencies remain with the New Veterans Charter, such as a need to increase the Disability Award and improve access to the Permanent Impairment Allowance and its Supplement to ensure that the most seriously ill and injured veterans have the economic and financial support they need to compensate for their loss of employment and career opportunities.

The National Association of Federal Retirees believes that Minister O’Toole’s announcement is a step in the right direction, but that more substantive changes are urgently needed to support Canada’s veterans and their families who have been injured in service to their country.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service, Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 60,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

The Notice of Application seeks to have the Federal Court declare the Government of Canada’s actions regarding the Public Service Health Care Plan (PSHCP) unlawful.

On March 26, 2014, Treasury Board President Tony Clement announced that he approved an agreement for the Public Service Health Care Plan or PSHCP that would see the retiree contribution rate go from 25 percent to 50 percent. Although it was characterized as a negotiated deal, the Association believes that the government did not honour the spirit or principles of negotiation. The National Association of Federal Retirees’ Board of Directors decided, in December 2014, to take legal action in response to the government’s decision to unilaterally proceed in increasing the costs pensioners pay for their Public Service Health Care Plan.

The National Association of Federal Retirees will keep all of members apprised of the Notice of Application and its developments as appropriate.
If you are a member, you can help by providing the Association your email address and full contact information. It’s the fastest way for our members to become aware of new developments, or to participate in our advocacy campaigns. You can also watch for more on this issue on our website, in Sage magazine, and by regular mail.

If you haven’t yet joined the National Association of Federal Retirees, enroll today. As a not-for-profit advocacy organization, we have strength in numbers and your membership matters. The larger our Association becomes, the stronger our voice – and the more effectively we can speak on behalf of federal retirees. Learn more about membership here.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service, Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 60,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

To learn more about the Annual Award categories and nomination process, please click on the following link www.federalretireesawards.com.

Unfortunately, printing these new packages has taken substantially longer than planned. As a result, we have not been able to issue 2015 cards to both new and renewing members.

We understand that the packages are expected to be in the mail by the end of February.

We sincerely apologise for any inconvenience that this has caused any of our members. If anyone would like a temporary card until the new cards are available, please contact the national office at info@fsna.com or toll-free at 1-855-304-4700.

At the National Association of Federal Retirees, volunteers are our lifeblood. Over 1,000 volunteers work at the branch, regional, district and national levels. Our volunteers provide leadership, deliver member services, and advocate on behalf of our members. Each volunteer is driven to make a difference and has a story to tell.

The Association’s Volunteer Awards program provides an opportunity for any member of the Association to nominate a deserving individual or branch for recognition at our Annual Recognition Dinner. This gala event is held in conjunction with our Annual Members Meeting in June 2015.

For additional information, please contact Gail Curran at (613) 745-2559 extension 235 or gcurran@fsna.com.

To learn more about the Annual Award categories and nomination process, please click on the following link www.federalretireesawards.com.

Nomination forms are available on line format or in Word.

The letter was circulated to inform retired members who are not participating in the PSHCP, that they may be affected by the new eligibility criteria. If you are already a retired member with PSHCP coverage, and you have any concerns or questions regarding your continued coverage under the PSHCP, please contact the appropriate pension administration centre listed below.

The distribution list used for the letter was an amalgamation of retired members not enrolled in the PSHCP from amongst the five different pension plans (the Public Service Pension Plan, the Canadian Forces Pension Plan, RCMP Pension Plan, retired Judges and retired Members of Parliament). Individuals identified as non-PSHCP participants under one of the pension plans could not be cross-referenced with participants identified under the other plans. Examples of this are veterans who went to work as public servants after retiring from the Forces, or retired public servants who also receive a survivor pension. These individuals may receive more than one pension, but premiums for the Public Service Health Care Plan are only be deducted from one of their pensions. In addition, retired members who are not PSHCP members in their own right, but who have coverage as a dependant, will also have received this notice.

Retired federal employees from the Wheat Board, Canada Post, and others, may also have received this letter but are not eligible for pensioner coverage under the Public Service Health Care Plan.

If you have any concerns or questions regarding your continued coverage under the PSHCP, please contact the appropriate pension administration centre at the coordinates provided here. They are aware of the situation and will be happy to assist you in this regard.

Former public servants
Toll free: 1-800-561-7930
Monday to Friday
8:00 a.m. to 4:00 p.m. (your local time)

Outside Canada and the United States: 506-533-5800 (collect calls accepted)
Monday to Friday
8:00 a.m. to 5:00 p.m. (Atlantic time)

Telephone Teletype (TTY): 506-533-5990
(collect calls accepted)
Monday to Friday
8:00 a.m. to 5:00 p.m. (Atlantic time)
Excluding Statutory Holidays

Facsimile
418-566-6298

Canadian Armed Forces veterans
1-800-267-0350 (toll free from anywhere in Canada and the United States)
613-952-9933 (within the National Capital Region)
1-855-255-9935 (Teletypewriter (TTY))

RCMP veterans
Toll-Free: 1-855-502-7090
Executive Services: 1-855-502-7088 (C/Supt, EX-01 and above)
Monday to Friday: 8:00 a.m. to 4:00 p.m. (your local time)

Outside Canada and the United States:
506-533-5800 (collect calls accepted)
Monday to Friday: 8:00 a.m. to 5:00 p.m. (Atlantic time)

Telephone Teletype (TTY):
506-533-5990 (collect calls accepted)
Monday to Friday: 8:00 a.m. to 5:00 p.m. (Atlantic time)

Retirees did their work and earned their pay. They have no union to bargain a new deal for them. The PSHCP Retiree Representative has done everything possible to contain the damage to Retirees, in a situation where the Government won’t really negotiate. We thank him for that.

If your benefits can be altered after retirement, without your consent, what will be next? Whatever so-called “deal” is forced upon Retirees, we cannot sit idly by while the Government takes what you have already earned.

As a result the Association has authorized the firm of Gowling Lafleur Henderson LLP to take necessary legal action to protect all Retirees whose rights and interests are at risk.

We sincerely apologize for any inconvenience this may have caused.

“We must honour the service and sacrifices made by all of our veterans, including veterans of the Royal Canadian Mounted Police,” says Federal Retirees President Gary Oberg. “Extending the Veterans Independence Program is a good place to start, and that is why we strongly support Peter Stoffer’s bill C-633 to extend the Program to RCMP veterans.”

Bill C-633 was introduced in the House of Commons by MP Peter Stoffer on October 27, 2014. The bill seeks to extend the Veterans Independence Program to RCMP veterans and their spouses, which is currently available only to eligible military and allied veterans and their survivors. The Program helps veterans remain independent and self-sufficient in their home and community. Depending on health needs and circumstances the program provides financial assistance to obtain services such as snow removal, grass cutting, housekeeping, access to nutrition, personal care and other support services provided by a health professional.

“The Program gives veterans the opportunities and means to secure home care services that can help them remain in their homes,” says Oberg. “It gives veterans dignity and independence – so let’s do the right thing and support Bill C-633, and make sure that RCMP veterans have the right to access the Veterans Independence Program.”

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service, Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 60,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

For further information:
Rosemary Pitfield
Director, Advocacy and Communications
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

This decision was made in accordance with the objects of our Association: to oppose measures detrimental to the interests of members and potential members; and in support of the many members who have contacted the Association requesting that we take action to defend their retirement benefits.

We ask for your patience throughout this process and would like to reassure you that we will keep you informed as appropriate.

Sincerely, Gary Oberg
President
National Association of Federal Retirees

At 11:00 AM EST on November 11, 2014 in Ottawa, Lieutenant Colonel Peter Kerr (ret’d.), Canadian Forces’ Decoration recipient and Director with the National Association of Federal Retirees, will lay a wreath during the National Remembrance Ceremony on behalf of the Association’s members. The wreath is in honour of those who have served, those who continue to serve, and those who will serve in the future.

At the eleventh hour on the eleventh day of the eleventh month, please take the time to pause to mark the sacrifice and honour of Canada’s veterans, military, RCMP and first responders.

To all of our veterans and their families, thank you for answering the call to serve, and for making Canada and the world a better place to live.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service, Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 60,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

For further information:
Rosemary Pitfield
Director, Advocacy and Communications
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

The report by the Conference Board of Canada titled A Survey of Non-retirees and Retirees in Canada: Retirement Perspectives and Plans, with the support of the National Association of Federal Retirees and Aon Hewitt, explores attitudes, knowledge and behaviours of employers and of individual Canadians on a variety of issues related to workplace and public retirement savings and pension plans, and on retirement readiness.

“The findings in the report clearly demonstrate some of the rather disturbing realities of retirement readiness among Canadians, which is a major concern for a large proportion of us,” said Sylvia Ceacero, Chief Executive Officer of the National Association of Federal Retirees. “It underscores an urgent need for real solutions to help Canadians prepare for their retirements.”

The study also revealed striking shifting realities of retirement income sources. Those currently retired are more likely to cite their past workplace retirement savings plans (41.5 percent) and public pension plans (27.5 percent) as their primary sources of retirement income, and they are less likely to say their primary source of retirement income is personal savings (14 percent). Those currently working have less confidence that workplace and public pension plans will be their primary sources of retirement income (20.7 percent and 17.9 percent, respectively).

Four in ten respondents indicated that they have a good understanding of the income they would receive from public pension plans. About one-third of the surveyed working Canadians simply did not know when they will retire completely from the paid labour force—and up to 19 percent of respondents say that they will never retire.

“Financial literacy plays an important role in how confident Canadians feel about their retirement plans, yet most rate their level of financial literacy as average at best”, said Judith MacBride-King, the project lead for The Conference Board of Canada. “This is a clear indication that there is a need for employers and other stakeholders to consider how they can help Canadians get the information they need to make informed decisions regarding their financial future. We hope this study will help raise awareness on the issues and encourage greater action on the part of employers, governments and individuals themselves.”

“The data and perspectives in the study should become a go-to resource for public policy-makers across all orders of government, as well as for employers, plan providers, and Canadians themselves to act upon together, to build a sustainable retirement income security strategy for all Canadians,” added Ceacero.

The report also explores the experiences and perspectives of current retirees—examining a variety of issues that include how retirees are currently funding their retirement, their views on their financial wellbeing, and their expectations for the future. Retirees were also asked to reflect on their experiences and provide any insights regarding retirement readiness that would be helpful to younger workers and their employers.

The Conference Board of Canada launched, in 2014, a comprehensive study into the experiences and perspectives of employers and individual Canadians to help inform organizational and public policy and contribute to the ongoing discourse on these critical issues.

The study involved 177 employer respondents from a cross-section of public and private sector organizations and 1,656 individual Canadians aged 18 to over 65 years including labour force participants and retirees from across the country.

Download the report at http://www.conferenceboard.ca/e-library/abstract.aspx?did=6544 and http://www.conferenceboard.ca/e-library/abstract.aspx?did=6540.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service,   Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 50,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

For more information on how pension benefits are protected from inflation, click here.

Warrant Officer Vincent, a soldier for 28 years, was killed in a targeted hit-and-run in St-Jean-sur-Richelieu, Qc., on October 20, 2014. Corporal Cirillio, a reservist guarding the National War Memorial in Ottawa, was shot and killed by a masked gunman on October 22, 2014.

The Association commends the heroic efforts of the RCMP, Ottawa Police Services, Parliamentary security guards and members of the Canadian Armed Forces for their work to keep Canadians safe every day, at home and abroad.

Oberg, a veteran of the RCMP with more than 27 years of service, focused on the most pressing issues that are affecting all Canadian veterans, including Canadian Armed Forces and RCMP members and their families.

“The Association continues its work on behalf of all veterans and their families, by bringing these critical issues forward as priorities for the 2015 federal budget,” said Oberg. “It is now time to resolve the financial deficiencies of the New Veterans Charter, to ensure the resources veterans need are ready and available, and overall, to ensure all veterans are treated fairly, equitably and with dignity.”

In his closing remarks, Oberg emphasized the need to maximize the number and types of jobs for Canadians, including military and RCMP veterans, by providing a tax incentive for employers that hire veterans as a means to assist veterans in the transition to meaningful employment following their service to Canada, building and strengthening Canadian communities in the process. A Veterans Affairs Canada 2010 Life After Service Study confirmed that 25 percent of veterans experience difficulty in transitioning to civilian life.

Click here to watch the video or listen to the audio of the presentation

Click here to download Mr. Oberg’s presentation notes

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service,   Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 50,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

For further information:
Rosemary Pitfield
Director, Advocacy and Communications
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

We sincerely apologize for any inconvenience this may have caused.

Association staff will be on site to talk to run participants and supporters about the Association and the benefits of membership.

This is also a great opportunity to learn about how the Association is working to ensure fairness, accessibility and equity for all veterans, and elevating retirement income and health care security for all Canadians.

Visit us at Booth #307 located at Marion Dewar Plaza, in front of Ottawa City Hall.

Click here to learn more about the membership advantage for veterans, and get access to a free download of the special veterans edition of Sage Magazine (Summer 2014).

Come join the Association as it cheers on the Army Run participants this weekend in our national capital!

About the Canada Army Run

The Canada Army Run has become the fastest growing run in Canada!  In less than six years, the number of participants has more than tripled, from 7,000 in the 2008 inaugural run to more than 22,000 in 2013.

The event is celebrating the 100thanniversary of Princess Patricia’s Canadian Light Infantry, (The Patricias’ or The PPCLI), and the Royal 22e Regiment, (‘The Vandoos’). Learn more at www.armyrun.ca.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service,   Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 50,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

That is the guiding question behind our major policy conference happening on October 2nd and 3rd of this year.

Join Canada 2020 in Ottawa as we will tackle the big, forward-looking questions of our time. By 2020, what do we want to accomplish as a nation? What areas of progress are important to us? And where do we want to be on the world stage?

Right now, Canada is at an inflection point: the marketplace for ideas is open, and our policy community needs new ways to grow our economy, strike a balance between energy and the environment, rebuild healthy, sustainable communities and navigate complex, 21st century challenges like privacy and international security.

The #Can2020 Conference is our opportunity to set in motion the idea-generation process that will carry Canada into a new decade. Together with the Center for American Progress’ Global Progress Initiative, we invite you to hear some of the world’s most influential thinkers, organizers, policy developers and business leaders.

Your conference pass includes access to all of the sessions during the two-day event (panels, breakouts, keynote speeches), a delegate kit, two lunches, and exclusive access to multiple networking receptions and socials throughout the conference.

October 2nd and 3rd, 2014
Ottawa Convention Centre
To register for the conference, visit www.canada2020.ca/event/can2020conference

The National Association of Federal Retirees applauds the report and the recommendations of Guy Parent, Veterans Ombudsman, and his team, and urges the Government to implement the Ombudsman’s recommendations immediately.

“There is a disconnect between the objective of the Allowances and the criteria veterans have to meet in order to access them and that disconnect has to be fixed immediately,” says Gary Oberg, President of the National Association of Federal Retirees.  “The most seriously ill and injured veterans, those who have been injured in service to Canada, and whose injuries directly impact their employment and career advancement opportunities, must have access to the financial support they need – and deserve.”

The Permanent Impairment Allowance and the Supplement are two financial benefits within the New Veterans Charter which are provided to the most severely injured or ill veterans who face a loss of employment and career progression opportunities from the effects of a permanent and severe impairment.  The Ombudsman’s report reveals that the eligibility criteria are too restrictive and therefore deny access to the benefit to those veterans that need it the most.

The National Association of Federal Retirees is the largest national advocacy organization representing active and retired members of the federal public service,   Canadian Armed Forces, Royal Canadian Mounted Police (RCMP), and retired federally-appointed judges, as well as their partners and survivors. With 185,000 members including more than 50,000 veterans and their families, the Association has a 50-year history of providing independent advocacy on issues affecting the financial security and health and well-being of our members and Canadians.

For further information:

Rosemary Pitfield
Director, Communications and Advocacy
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

 “As we honour the courage and sacrifice of the men and women who served their country bravely during the First World War, we must also remember our moral obligation, as a nation, to provide the care and support that all veterans and their families deserve,” says Gary Oberg, National President. “And we must continue to ensure we honour that commitment to all veterans, just as they have honoured their commitment to serve.”

The National Association of Federal Retirees is the largest national advocacy organization representing over 185,000 retired and active members of the federal public sector including more than 50,000 Veterans. Our members include federal public servants, veterans and members of the Canadian Forces and RCMP and federally-appointed judges, as well as their partners and survivors.

The Pan Am/Parapan Am Games will be the largest international multi-sport event held in Canada and will involve 16 communities in Ontario’s Greater Golden Horseshoe, from Ajax to Welland. The 2015 Pan Am/Parapan Am call for volunteers is one of the largest in Canadian peace-time history.

There is exactly one year to go until the Games begin, and there are many exciting volunteer opportunities starting now.

Association members who would like to volunteer can find additional information here, including a volunteer code that you should quote when you reach out to volunteer. This volunteer code will expire July 15, 2014, so contact the TORONTO 2015 volunteer team today. Call 1-855-388-20151-855-388-2015, email TO2015volunteer@cibc.com or visit www.toronto2015.org/volunteer-now. This is your chance to be the heart of the 2015 Pan Am/Parapan Am Games!

“It is very easy to take for granted the vital work our public service does each and every day for all Canadians,” says Gary Oberg, National President of the Association. “Public service is truly a calling, and our public service is the backbone of our democracy. So this week, we thank Canada’s public service present and past for what it is doing today and for what it has done for decades – serving Canadians and making this country work.”

FSNA is the largest national advocacy organization representing over 185,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

“We hope that their families, their colleagues, and the city of Moncton, can now begin to find peace and to heal,” says Gary Oberg, National President, who is also a veteran of the RCMP. “Even though RCMP veterans turn in our badges at retirement, when a tragedy like this happens, we grieve with the families of those lost, and with those who continue to serve.”

The National Association of Federal Retirees is the largest national advocacy organization representing over 185,000 retired and active members of the federal public sector. Our members include federal public servants, veterans and members of the Canadian Forces and RCMP and federally-appointed judges, as well as their partners and survivors.

Today, the National Association of Federal Retirees offers our solemn thanks and gratitude to veterans of the Second World War, and particularly those involved in D-Day, for their courage and sacrifice, and for honouring their commitment to serve.

“As we honour our veterans today, we must also remember our commitment, as a nation, to provide the care and support that all veterans deserve,” says Gary Oberg, National President. “And we must continue to ensure we honour that commitment to all veterans, just as they have honoured their commitment to serve.”

The National Association of Federal Retirees is the largest national advocacy organization representing over 185,000 retired and active members of the federal public sector. Our members include federal public servants, veterans and members of the Canadian Forces and RCMP and federally-appointed judges, as well as their partners and survivors.

“This conversation is vital in terms of the role each one of you could play,” noted Hassan Yussuff. “You’ve made Canada a great place, but we also need to talk about the next generation, and that’s your kids, your grandkids, your nieces and nephews. We need to have some faith that it can be made better.”

FSNA believes that having open, vibrant conversations with politicians, experts, corporate Canada, non-governmental organizations, and Canadians, will allow us all to work together to achieve retirement income and health care security for all Canadians. Today’s town hall meeting was the first in a series of national platforms where those conversations can take place. It was clear that more of these conversations need to happen, and that the greatest impact will happen through partnerships.

The province’s Health and Wellness Minister, Doug Currie, was clear that the way forward and on these issues is through partnership and collaboration – and that message resonated strongly with the speakers and with the audience.

“On the one hand, you have the federal government saying problems with health care are because of how it’s being delivered by the provinces; the provinces say it’s because they’re not getting enough money,” said Member of Parliament Sean Casey. “It’s high time the partnership Minister Currie calls for, happens.”

FSNA is the largest national advocacy organization representing over 186,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

For further information:
Rosemary Pitfield
Director of Communications
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

When:
Tuesday, 27 May 2014 , 1:00 PM to 4:00 PM (EDT)

Where:
The Murchison Centre
17 St. Pius X Avenue
Charlottetown, PE, C1B 2B7

Who:
Member of Parliament for Charlottetown Sean Casey
PEI Health and Wellness Minister Hon. Doug Currie
Canadian Labour Congress President Hassan Yussuff
Mayor of Charlottetown Clifford Lee
Dr. Dave Bannon, Medical Society
Dr. Richard Wedge, Health PEI
Representatives from PEI’s Ministry of Finance and Ministry of Community Services and Seniors

For more information, please contact:
Rosemary Pitfield
Director of Communications
Office: 613-745-2559, extension 225
Mobile : 613-323-0872
Email: rpitfield@fsna.com

The National Association of Federal Retirees will conduct a complete analysis of the Auditor General’s report. “The Auditor General’s report is important to federal retirees, employees, to serving members and to veterans of the Canadian Forces and the RCMP,” says FSNA’s National President Gary Oberg. “And it’s more important that we conduct our own review of the report and work not only on behalf of our members’, but also to make sure this report is not turned into rhetoric that distracts us from the real issue – that all Canadians need better retirement income security.”

The report found that the various departments responsible for federal pensions have fulfilled their responsibilities, but that the plans could be improved with stronger governance policies and practices, including implementing a funding policy and conducting regular reviews of the pension plans’ sustainability. The Auditor also noted that today’s investment environment – prolonged low interest rates, lower than expected returns and increasing longevity – could have an impact on pension liabilities and on the federal government’s bottom line.

But many Canadians do not have access to an adequate pension plan and they lack adequate savings to provide for a reasonable retirement income. Pension fairness should focus on raising the standard that would afford all Canadians the opportunity to have a predictable and secure retirement income. Collaboration and conversations are critical to moving forward on pension fairness: larger numbers of Canadians working towards the same outcomes will bring more creativity, more resources, more credibility and more momentum to the outcome.

FSNA is the largest national advocacy organization representing over 185,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

John was with the Canadian Forces for over thirty years, and retired as a Colonel. He held a number of senior roles in the compensation and benefits area, and was a senior management consultant for many years. He willingly gave time in his retirement to FSNA, serving federal retirees in British Columbia at the branch, regional and provincial levels, and later served on our National Board of Directors as National Director for British Columbia. Most recently, John was FSNA’s 3^rd National Vice-President. John was also an enthusiastic volunteer within his community in the Comox Valley.

John worked tirelessly on behalf of federal retirees until the end of his life. For years to come, we will look to John’s commitment, energy and expertise, and the passion he had for advocacy, as inspirational and exemplary.

Federal retirees extend their heartfelt condolences to Karen, John’s wife, and their daughters Tara and Tonya, and celebrate all that he gave to the National Association of Federal Retirees.

Members who are considering allowing their name to stand for election at the June 2014 Annual General Meeting (AGM) are asked to submit the required documentation at their earliest convenience.

Most FSNA members have invaluable general skills that would be an asset to any board including FSNA’s National Board of Directors. There are also many members with unique skills who would be welcome additions, such as those with experience in:

• Advocacy at a national level coordinated at the local level
• Strategy development
• Communication internally and externally
• Oversight of staff and volunteer activities
• Policy development
• Financial oversight

FSNA bylaws state that “any member, other than an honorary member, is eligible to be elected as a National Vice-President …”

All potential candidates, including those who see a correlation between their experience and skills and the needs of FSNA’s Board, are encouraged to consider offering volunteer services to the Association.

This election is to fill a vacancy which will begin immediately following the end of the 2014 AGM and run until the end of the term at close of the June 2015 AGM.

The summer issue of Sage magazine will feature profiles of candidates who, at press time, will have announced their intention to stand for election.

If you are interested in joining FSNA’s National Board of Directors, please contact Al Heinrich, chair of the Nominating Committee, by e-mail at elections@fsna.com.

Click here to download a copy of the nomination form.

Al Heinrich,
Chair of the Nominations Committee
National Director, British Columbia/Yukon

Mr. Flaherty believed in public service, which he explained to business students. “Public service is good for you. It’s unlike any other career. It features long hours, relatively lower rates of pay than comparable positions on Bay Street, and it is often decades before you can witness the positive results of your labour. It is the most satisfying and personally enriching career you will ever find. This, my friends, is priceless.”

On behalf of its 185,000 members, the National Association of Federal Retirees extends its most sincere condolences to Mr. Flaherty’s family and friends.

The National Board of Directors shares your frustration and anger. We are very disappointed that the Government of Canada chose not to listen to federal retirees and supporters who loudly voiced their opposition to these moves with their elected federal representatives.

We understand the importance of keeping you informed of the outcome of the PSHCP negotiations. Two big changes include the cost-sharing ratio shifting to 50/50 and more years of pensionable service will be required for new retirees who opt to join the PSHCP. But FSNA was able to achieve some protection for retirees, including a four-year phase-in period for the cost-sharing ratio shift, protection for low-income retirees and several plan enhancements.

The following outlines the changes that will be implemented for the PSHCP and what those changes may mean to you.

Effective April 1, 2015, members who were retired or who will retire before March 31, 2015, will not be affected by the cost-sharing change if their income is below the Guaranteed Income Supplement (GIS) thresholds under the Old Age Security Act. For reference, the 2014 GIS thresholds are $16,728 for single pensioners or $22,080 for couples. These thresholds change annually.

The cost sharing will be phased in over a four-year period as follows:

Retired Member Monthly Contribution Cost Sharing Percentages
Cost Sharing for Retired Members

Effective April 1, 2015, new retirees will require a total of six years or more of pensionable service to be eligible as retired members under the Public Service Health Care Plan. Some exemptions will apply, including for disabled retired members, survivors, the Veterans Affairs Canada client group and those affected by Workforce Adjustments.

Effective January 1, 2015, the annual deductible will be eliminated. Plan members will no longer have to pay the first $60 for single coverage or $100 for family coverage per calendar year.

Effective October 1, 2014, the following benefit enhancements will be introduced for all members of the Public Service Health Care Plan:

• Expanded vision care benefit to include reimbursement for laser eye surgery with a lifetime maximum benefit of $1,000
• Coverage for repairs, replacement parts and servicing of aerotherapeutics devices with an annual maximum benefit of $300
• An increase to the annual maximum benefit for psychological services from $1,000 to $2,000

Though this has been characterized as a negotiated deal, FSNA believes that this government did not honour the spirit or principles of negotiation. We were faced with an ultimatum by Mr. Clement that would have seen the government legislate to the lowest common denominator, which would have created further hardship for our most vulnerable members.

As we continue to explore our legal options, we will keep you apprised and engaged.

Scammers might call you at home and claim to be Microsoft or Windows support technicians. These scammers often use phone directories and other public information, so they might know your name and other personal information when they call you. They may also guess what computer operating system you are using. Scammers will offer to help solve your computer problems, tell you your computer has a problem or offer to sell you a software license, and they may ask you to provide them with remote access to your computer. You can end up paying for phony services, or your computer’s security settings can be compromised.

It’s important to know that neither Microsoft nor its affiliates make unsolicited phone calls to support your computer or software. If you receive such a call, it is highly likely that it is a scam.

Here are some do’s and don’ts that will help protect you from technology scams:

• DO NOT purchase any software or services from unsolicited calls about your computer system.
• DO NOT give control of your computer to a third party unless you can confirm that it is a legitimate representative of a computer support team with whom you are already a customer.
• DO NOT provide your credit card or financial information to someone claiming to be from Microsoft or Windows tech support.
• DO ask if there is a fee or subscription associated with the “service”. If there is, DO hang up.
• DO take the caller’s information down and immediately report it to your local authorities.

If you believe you are the victim of a technology scam, you must contact your local police authorities and report it.

We understand your frustration and anger at the treatment you feel you have received from your former employer, the Government of Canada. FSNA is considering its options to challenge the government's decision to increase the health care premium ratio from 25/75 to 50/50 for federal retirees. In February the Association initiated a review of the potential legal options available to our members.

The National Board of Directors shares your frustration and anger. We are very disappointed that the Government of Canada chose not to listen to federal retirees and supporters who loudly voiced their opposition to these moves with their elected federal representatives.

Even though this has been characterized as a negotiated deal, FSNA believes that this government did not honour the spirit or principles of negotiation, and in spite of our best efforts, it will not honour the promises made to federal retirees. We were faced with an ultimatum by Mr. Clement that would have seen the government legislate to the lowest common denominator, which would have created further hardship for our most vulnerable members.

As we continue to explore our legal options, we will keep you apprised and engaged.

Sincerely,

Gary Oberg
National President
National Association of Federal Retirees

I would like to thank all of you for taking the time to write letters, sign petitions and meet with your member of parliament regarding your concerns about the government's intention to increase your contributions to the Public Service Health Care Plan from 25 percent to 50 percent.

Treasury Board President Tony Clement has confirmed, during a media conference today, that he has approved an agreement for the Public Service Health Care Plan that will see the retiree contribution rate go from 25 percent to 50 percent.

Faced with an ultimatum made by Mr. Clement, “negotiate a deal or the government will legislate to the lowest common denominator,” FSNA was able to achieve some protection for retirees with a four year phase in period of the new 50-50 cost sharing for Public Service Health Care Plan premium costs that will begin in April 2015. And, guarantee that low income pensioners, who receive the guaranteed income supplement (GIS), would be exempt from the increase and would continue to make contributions at the 25-75 ratio. Those who have yet to hit 65 but meet the single or family income thresholds of the GIS will also be exempt from the increase.

FSNA will continue to work on your behalf to ensure that you may have dignity and security in retirement. As an association representing retired public servants, Canadian Forces, RCMP, Federal judges and their survivors, FSNA is very disappointed that the Government of Canada did not listen to the more than 74,000 members who wrote letters to their MPs and Treasury Board President Tony Clement asking the government to honour the promises made to them when they were employees of the Government of Canada.

Gary Oberg
FSNA President

Update March 27 2014 – Ottawa Citizen article ‘Public-service retirees unhappy with agreement over health benefits’

There is an important change on tax slips for public service retirees: the inclusion of the premiums paid towards the Pensioners’ Dental Services Plan (PDSP) and Public Service Health Care Plan (PSHCP). These premiums are now found in box 135 of the T4-A and box 235 of the Relevé-2 and may be claimed on income taxes as a medical expense. With this information immediately available on the T4-A or Relevé-2 tax slips, income tax preparation and filing will be easier for federal retirees.

The National Association of Federal Retirees worked with Public Works to bring this change to public service retirees. These changes will help make the tax season easier for federal retirees this year and for federal employees next year. Note that RCMP and Canadian Forces retirees will see this change in due course.

If you have questions about your T4-A or Relevé-2, please contact the appropriate pension administration for the Public service, Canadian Forces or RCMP.

This survey presents the recommendations of a focus group which consisted of 25 participants – members, prospective members, volunteers at all levels, staff and partners. This group jointly developed a Vision, a Mission, Strategic Outcomes and Values – the framework on which Strategic Goals and operational plans for 2016 to 2018 will be developed.

Your opinion, as a senior volunteer, is critical. However, the survey is open to any member of FSNA. I therefore encourage you to share the link with all of your Branch volunteers and your members.

The survey is a simple, anonymous, on-line questionnaire with nine questions, and should take only a few minutes to complete. Simply click on the link below.

https://www.surveymonkey.com/s/FSNA-Strategic-Survey

I look forward to your input.

Gary Oberg,
National President,
FSNA

FSNA is reviewing all of its options and determining a go forward strategy. The Board has instructed the Executive Director to ascertain the legal options, potential costs and potential outcomes and likelihood of success regarding the PSHCP matter.  We will keep our volunteers and members informed and reach out to you to work together as we strive to get this government to listen to us and to Canadians.

“Federal retirees and in particular our veterans, are disappointed that the government chose to announce this unilateral move in the budget,” says National President Gary Oberg. “We believe this is unprecedented and flies in the face of the principles of negotiation.”

Retiree costs and eligibility for the PSHCP have been the subject of ongoing negotiations within the National Joint Council, comprised of federal employee unions, the National Association of Federal Retirees and the Treasury Board. In summer 2013, media reports alerted federal retirees to the possibility of the Treasury Board imposing non-negotiable changes to retiree health insurance coverage. The National Association of Federal Retirees launched the advocacy campaign Honour Your Promise, writing tens of thousands of letters to their Members of Parliament and to Treasury Board President Tony Clement, as well as signing petitions with more than 24,000 signatures. The letters and petitions ask Treasury Board President Tony Clement to honour the promises made to federal retirees and to immediately stop plans that are detrimental to the retirement and health care security of any Canadian.

“We have trusted that this government would honour the negotiation process, as well as its promises,” says Oberg. “Yesterday’s budget demonstrated that this government does not respect the negotiation process and that they seem to believe that they have the right to legislate what should be negotiated.”

FSNA is the largest national advocacy organization representing over 186,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

The Federal Government indicated, in yesterday’s budget, its intention to arbitrarily double the Public Service Health Care Plan premiums for retired members of the Canadian Forces, Veterans, RCMP and public servants. The government also signalled its intention to increase the eligibility period to require employees to work a minimum of six years in order to be eligible to receive coverage under the PSHCP in retirement.

FSNA through the Leader of the Opposition, Thomas Mulcair, tabled a petition in the House of Commons last Wednesday. Unfortunately Prime Minister Stephen Harper and most of his cabinet, including Treasury Board President, Tony Clement chose to leave the House immediately prior to the tabling of the petition. More than 24,000 members and citizens at large signed FSNA’s House of Commons petition and online petition at Change.org.

More than 74,000 FSNA members wrote letters to the Members of Parliament and Mr Clement indicating their concern over the rumoured increase to their PSHCP contributions. Many provided a detailed account of the negative impact this increase would have on their ability to pay for life necessities at this stage of their retirement.

FSNA is reviewing all of its options and determining a go forward strategy. Yesterday, at a web conference, the Board instructed the Executive Director to ascertain the legal options, potential costs and potential outcomes and likelihood of success regarding the PSHCP matter. We will keep our volunteers and members informed and reach out to you to work together as we strive to get this government to listen to us and to Canadians.

Sincerely, Gary Oberg, National President

Submission Deadline 11 April 2014

FSNA was built on the energy and commitment of volunteers, and today, over 1,000 dedicated volunteers at all levels of the organization work together to support and advocate for our members and all Canadians in retirement.

To recognize the exceptional contribution of our volunteers, FSNA is pleased to announce that nominations are now being accepted for the 2014 Volunteer Awards. The deadline for submissions for is 11 April 2014.

Award categories include:

Annual Awards (nominated by any member of FSNA)

• The Claude Edwards Leadership Award
• The Innovation Award
• The Volunteerism Award
• The National President’s Commendation

The Fred Whitehouse Founder’s Award (nominated by the National Board of Directors)

• The Fred Whitehouse Founder’s Award is a special award that will not be presented every year, but by exception when the National Board of Directors identifies a worthy candidate.

Presentations
Awards will be presented at FSNA’s Annual Recognition Dinner, June 27th, 2014 in Montreal, in conjunction with the Annual General Meeting.

Certificates for the National President’s Commendation will be presented at an appropriate occasion selected by the nominator and recipient.

Nominate a worthy candidate now!
Details on the award categories and submission instructions are available at www.fsna.com/volunteer-recognition.htm or by contacting Ysabel Anderson at yanderson@fsna.com or (613) 745-2559 Ext 229.

The government expects this will result in savings of $1.4 billion in 2014-15 and $7.4 billion over six years.

The government has indicated its plans to implement these changes – but whether any cost savings result remains to be seen.

Further analysis to come.

To read an extract of the budget document and learn more about what’s in store for federal retirees, please click the following link: 2014 budget extract for federal retirees.

A number of services will be available to FSNA members such as medication reviews, medicine cabinet reviews and in-store programs (i.e., flu shots and blood pressure clinics). Look for articles in the new magazine on health issues that matter to you and watch for Shoppers Drug Mart representatives attending your local branch meetings to present information on the latest health topics.

Shoppers Drug Mart will also be working with FSNA on our national advocacy strategy, working with stakeholders to promote accessible, quality, and affordable health care for Canadians. For more details, click here.

Shoppers Drug Mart Corporation is one of the most recognized and trusted names in Canadian retailing. The company is the licensor of full-service retail drug stores operating under the name Shoppers Drug Mart (Pharmaprix in Québec). With 1,246 Shoppers Drug Mart and Pharmaprix stores operating in prime locations in each province and two territories, the company is one of the most convenient retailers in Canada. The company also licenses or owns 55 medical clinic pharmacies operating under the name Shoppers Simply Pharmacy (Pharmaprix Simplement Santé in Québec) and six luxury beauty destinations operating as Murale. As well, the company owns and operates 62 Shoppers Home Health Care stores, making it the largest Canadian retailer of home health care products and services. In addition to its retail store network, the company owns Shoppers Drug Mart Specialty Health Network Inc., a provider of specialty drug distribution, pharmacy and comprehensive patient support services; and MediSystem Technologies Inc., a provider of pharmaceutical products and services to long-term care facilities.

For more information, visit www.shoppersdrugmart.ca

“The government is conveniently shifting public attention away from the issues that really matter,” said Mr. Gary Oberg, President of the National Association of Federal Retirees (FSNA). “It has become politically convenient to attack a minority of Canadians while ignoring the urgent need to raise the bar on health care and retirement income security for all Canadians.”

The petition, signed by thousands of federal retirees and their supporters, asks Treasury Board President Tony Clement to honour the promises made to federal retirees and to immediately stop plans that are detrimental to the retirement and health care security of any Canadian. Over 20,000 people have also signed an online petition at change.org. Electronic petitions are not accepted by the House of Commons at this time, though a recent NDP motion could change that in the future.

Coverage under the PSHCP in retirement is part of the compensation promised to federal retirees for their years of service to Canada.  Media reports in July 2013 alerted federal retirees to the Treasury Board’s alleged plans to proceed with non-negotiable changes to the Public Service Health Care Plan (PSHCP) that would effectively double health insurance costs for federal retirees, including military and RCMP veterans. Changes could also make some federal retirees ineligible for health insurance coverage in their retirements.

Speaking on behalf of the Official Opposition at a media conference prior to the tabling of the petition, NDP Treasury Board critic and MP Mathieu Ravignat offered his support to federal retirees. “The Conservatives have to understand that they can’t change the rules for federal pensioners overnight,” said Mr. Ravignat. “We’ll continue to pressure them to stop their attacks against the public service.”

 “This issue is about more than balancing budgets and ensuring the public service is affordable for Canadians,” says Oberg. “This is about honour, and it is about whether or not the Government of Canada will meet the moral obligations it has – and honour the promises made – to its retired employees and veterans regarding their compensation.”

FSNA is the largest national advocacy organization representing over 186,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

- 30 -

For further information:
Rosemary Pitfield
Director of Communications
Office: 613-745-2559 ext 225
Mobile: 613-323-0872

“Federal retirees served Canada with honour and dedication during their careers. Their compensation includes their post-retirement benefits, it was negotiated,” says Gérald Denis, FSNA’s National Director for Québec. “This is what they worked for. To rescind part of that compensation now is to break a promise – to roll back deferred compensation after services have been rendered.”

Media reports in July 2013 alerted federal retirees to the Treasury Board’s alleged plans to proceed with non-negotiable changes to the Public Service Health Care Plan (PSHCP) that would effectively double health insurance costs for federal retirees and change future retirees’ eligibility for the plan.

“This issue is about more than balancing budgets and ensuring the public service is affordable for Canadians,” added Denis. “This is about honour, and it is about whether or not the Government of Canada will meet the moral obligations it has to its retired employees, judges and veterans.”

FSNA is the largest national advocacy organization representing over 186,000 active and retired members of the federal public sector. Our members include federal public servants, veterans of the Canadian Forces and the RCMP and federally-appointed judges, as well as their partners and survivors. FSNA is a not-for-profit association with 83 branches across Canada that is focused on elevating retirement income and health care security for all Canadians. Even in retirement, Canada’s public servants and veterans are proud to continue to serve Canadians.

For further information:
Sayward Montague, Acting Director, Communications
montague@fsna.com
Office: 613-745-2559 ext 238
Mobile: 613-404-4554

“After the New Veterans Charter was implemented in 2006, it became very clear that many of the most vulnerable veterans – those with lower rank and with more severe injuries and disabilities – and their families – are not well-served by the Charter,” says Gary Oberg, National President of FSNA. “I believe that we can all work towards making the Charter more effective now that we have a comprehensive understanding of Veterans’ economic and non-economic benefits and where to focus our efforts. The Ombudsman’s report will be absolutely instrumental in steering conversations about the New Veterans Charter in the right direction.”

The New Veterans Charter was implemented in 2006 and was designed to provide veterans with the resources needed to shift to civilian life, moving the focus from the disability pension system and towards a comprehensive system that provides transitional and wellness support to veterans. But many veterans and veterans’ organizations, including FSNA, found that the Charter let down the most vulnerable veterans financially, in both the long- and short-terms.

The report’s release is timely. Veterans Affairs Minister Julian Fantino recently announced a decision to conduct a thorough review of the New Veterans Charter, including enhancements, when Parliament returns. This comprehensive review comes just two years after the Charter’s first five-year review. At that time, the federal government had closed the possibility of further reviews until 2016. In his report, the Ombudsman also urges the government to review the Charter every two years to ensure it continues to meet the realities and needs of the veterans’ community.

“All Canadians have a sacred obligation to ensure the people who have served our country, who have sacrificed so much for Canada, are taken care of when they come home – whether that means assistance to transition to civilian life and to new careers, or support through a lifetime of disability. I encourage every Canadian to read the Veterans Ombudsman’s report and to ask their Member of Parliament to support meaningful change to the New Veterans Charter and to ensure Canada continues to meet its obligations to veterans,” says Oberg.

FSNA is the largest national advocacy organization representing federal retirees, their partners and survivors, from the public service of Canada, the Canadian Forces, and the RCMP, as well as retired federally-appointed judges. FSNA is a not-for-profit volunteer association with 185,000 members and 83 branches across Canada. For more information, visit www.fsna.com.

Media inquiries:
Rosemary Pitfield
Director of Communications
Cell: 613-323-0872
Tel.: 613-745-2559
rpitfield@fsna.com

Reportedly, the federal government wants to make changes to the Public Service Health Care Plan. This plan was part of a negotiated agreement; federal employees made concessions in exchange for what was promised. Now the government wants to go back on their promise, doubling health insurance costs and reducing seniors’ finances.

Allowing the government to break a promise – any promise – sets a dangerous precedent.

We’ve made it easy to have your voice heard, because protecting pensions for all Canadians starts here, protecting promises made about the PSHCP. Ask that the Government of Canada honour the promises made and accepted in good faith. Shelve any plans that would be detrimental to the retirement and health care security of our seniors, including the changes being considered for the Public Service Health Care Plan.

With just a couple of clicks your voice will be heard. Visit our Honour Your Promise page and ask that the Government of Canada honours promises made.

If you’ve got the time, we hope you’ll sign our petition as well.

Check out our Facebook page.

Please join FSNA members across Canada to come together in collective action and voice your opposition to the rumoured changes to the Public Service Health Care Plan by writing to your Member of Parliament and sending a carbon copy of that letter to the President of the Treasury Board.

We’ve made it easy: all you have to do is download the letter, print two copies, sign them and send them to:

Name of Your Member of Parliament
House of Commons
Ottawa, Ontario
Canada
K1A 0A6

The Hon. Tony Clement, MP
House of Commons
Ottawa, Ontario
Canada
K1A 0A6

Be sure to write your MP’s name in the address and salutation fields on the letter, and when addressing the envelope. If you do not know who your Member of Parliament is, click here to search for your MP – it’s as simple as entering your postal code and clicking “search”.

Please note that mail may be sent postage-free to any Member of Parliament at the House of Commons address. No stamp is required.

You’ll notice that both letters are addressed to your MP.  That’s not a mistake. One of the copies is intended as a carbon copy for Tony Clement.

Each letter includes a blank space at the bottom where we encourage you to share your personal story about how this change would affect your quality of life. Your story demonstrates the impact that these changes have on people, making this more than just a policy decision.

FSNA will continue to fight for federal retirees. But we need your help. If we all work together, our voices  will be heard. All you have to do is print, sign and mail your letters.

We will be in touch with our members shortly to ask for your help in communicating with the government.

In an effort to identify solutions that would provide Canadians across the country with retirement income and health care security, the National Association of Federal Retirees is pleased to launch a series of platforms where conversations can take place so that experts and Canadians together can identify solutions and develop action plans for results.

You are invited to watch a live webcast of a panel discussion that will take place on Wednesday, June 19, as part of FSNA’s 2013 Annual General Meeting. This panel will feature pension and health care experts who will discuss how Canadians can work together to achieve retirement income and health care security.

Click here to start the FSNA webcast – Finding the right options for Canadians

Even in retirement, FSNA volunteers and members are proud to continue to serve Canadians.

The Court concluded its 75-page decision by saying that:

“The Superannuation Accounts are legislated records and do not contain assets in which the appellants have a legal or equitable interest. The Plan members’ interests are limited to their interest in the defined benefits to which they are entitled under the Plans. The government was not under a fiduciary obligation to the Plan members, nor was it unjustly enriched by the amortization and removal of the pension surpluses. Finally, the Plan members had no legal or equitable interest in the actuarial surplus reflected in the Superannuation Accounts to be expropriated by Bill C-78.”

This decision puts an end to the court proceedings that were initiated in 1999 by the Public Service Alliance of Canada; the Professional Institute of the Public Service of Canada on behalf of other National Joint Council bargaining agents and organizations, including FSNA; and the Armed Forces Pensioners’/Annuitants’ Association of Canada in conjunction with several RCMP associations and the Canadian Association of Professional Employees.

FSNA is disappointed in the outcome of the pension surplus case. The Association’s position has always been clear and consistent: that there should be an equitable distribution of the pension surplus among the stakeholders, that is, the pensioners, the employees and the employer.

Click here to read the Supreme Court’s decision.

Click here to read the full story.

Click here to read the news release.

Highlights of Bill C-45 include:

• Equalization of the cost-sharing ratio between MPs and the federal government, which will have MPs paying more for their pensions. MPs pay an estimated $11,000 in pension contributions annually, set to increase gradually from 2013 to 2017 to nearly $39,000. The retirement age for MPs will move from 55 to 65 for members elected to the next Parliament in 2015. In addition, the interest paid by the federal government to the MPs’ pension account will be reduced to a more realistic rate, from 10.4% to 4.7%.
• Equalization of the cost-sharing ratio between Public Service, Canadian Forces and RCMP employees and the federal government. From 2013 forward, all public servants will contribute more to their pensions under an equalized cost-sharing ratio. In addition, the retirement age for new public servants will increase from 60 to 65, and early retirement with thirty years of service will increase from age 55 to 60.
• Those hardest hit in the government’s deficit reduction focus continues to be federal employees. In the 2012 federal budget, the government announced $5.2 billion a year in spending cuts, largely in the form of job and program cuts. Public service pension reforms will account for $2.6-billion over the coming five years and $700-million a year after that, savings that are separate from the original $5.2-billion in savings announced in the 2012 federal budget. “By far the lion’s share of taxpayer savings from that $2.6 billion over five years obviously occurs in the public sector pension changes, because we have 420,000 public sector employees and there’s only 308 Members of Parliament,” Treasury Board President Tony Clement said.
• The Public Service, Canadian Forces and RCMP pension plan members are still in the dark as to the timing of pension contribution rate increases and other pension policy changes. These changes have not been announced which compounds the fear and anxiety created by the 2012 budget cuts.
• Low-to-moderate income federal employees will be hardest hit. Increased pension contributions for a person earning $45,000 annually before all deductions may have them taking home $1,300 less a year. Federal Public Service pensions currently average $25,991.
• The introduction of different retirement ages establishes two distinct employee groups, creating a double-standard and a two-tier benefit program. Two-tier systems have been shown to increase employer costs due to increased turnover, decreased productivity, lowered morale and intergenerational conflict in the workplace.

Federal public sector pension reforms continue to detract from the real issue: that many Canadians do not have pensions and adequate retirement savings. Rather than tear down federal employee pensions, the government should work with Canadian businesses, the provinces and citizens to find the solutions that would ensure that all Canadians have retirement income security.

FSNA is committed to continued advocacy for the protection and maintenance of the benefits earned by federal retirees. The Association will continue to closely monitor Bill C-45 and will remain vigilant in mitigating further risks to federal public sector pensions.

For those who retire in 2012 and are entitled to indexation, the increase is pro-rated based on the number of full months remaining in 2012 after the retirement date.

Pension indexation is calculated by comparing the 12-month average of the monthly Consumer Price Index of two consecutive years ending in September.

For more information on how these pension benefits are protected from inflation, click here.

Click here to read the full document.

Click here to read the full document

Click here to read the full document. Click here to read the letters to the Minister as well as the response letter.

The report provides a complete overview of the plan, including demographics of pension plan members, a summary of the plan’s performance, financial statements, and statistics on the pensions that are in pay and those that became payable up to March 31, 2011.

• Total plan membership increased by 0.6 percent to 564,901 members.
• Active contributors decreased by 0.3 percent to 316,206 members.
• Retired members increased by 2.9 percent to 184,835 members.
• Total employer and employee cash contributions remained at $4.3 billion.
• The share of total contributions between the employer and plan members was 65/35, respectively.
• Total benefit payments to eligible pension plan members and survivors increased by 5.1 percent to $5.2 billion.
• The value of accrued pension benefits increased by 5.9 percent to $134.2 billion.
• The value of the assets held by the Public Sector Pension Investment Board (PSPIB) increased over the past year to $42.3 billion. The investment return for the year was 14.5 percent.
• The net amount transferred to PSPIB during 2010–11 totalled $3.6 billion.
• The average annual pension for new retirees was $35,799, an increase of 0.4 percent over 2009–10.
• The basic benefit formula is 2 percent per year of pensionable service (to a maximum of 35 years) multiplied by the average of the five consecutive years of highest paid service.

The average pension, based on all pensions currently being paid regardless of retirement year, is $25,991, with an average of just over 24 years of pensionable service. The average pension for women is $20,229; for men, it is $29,845.

The average new pension that became payable in the 2010-2011 fiscal year is $35,799, including both men and women. Most unreduced pensions commence at age 55 and at age 60, with an average retirement age of over 59 years for both men and women.

The full report is available by clicking here.

Cost-savings initiatives have been underway for several years within the government, under the Strategic and Operating Reviews. Many reports indicated that the government would seek $4 to $8 billion in savings in this budget. Minister Flaherty announced that the government will achieve a $5.2 billion cost-savings this year, with lower budgetary deficits than previously anticipated. The federal budget is estimated to return to a surplus position by 2015-2016.

Key to government cost-savings initiatives are pension reform initiatives and cuts to the federal public service. Future savings will be achieved by way of significant changes to Old Age Security.

Pension reform
The federal government reiterated its commitment to respecting its pension obligations, but the plan will see significant changes for current federal public sector employees and new hires to the public service.

First, employee contributions will be raised. Starting January 1, 2013, employee contribution rates under the public service pension plan are projected to increase over time to reach a 50:50 employer/employee cost-sharing ratio.  Member contribution rates under the Canadian Forces and RCPM pension plans will be increased to match those set for the public service pension plan.

Effective January 1, 2013, the retirement age for new hires will be age 65. Currently, federal public servants may retire with an unreduced pension at age 60. This measure does not apply to the pension plans for members of the Canadian Forces or the RCMP.

Public service cuts
In total, federal employment will be reduced by 19,200, with 12,000 government positions eliminated over a three-year period. Six hundred executive positions will also be eliminated. The Government has estimated that some 7,000 of the 19,200 will be dealt with by attrition due to turnover and retirements.

Old Age Security
Among the most contentious changes in Budget 2012 are those to the Old Age Security (OAS) program. Polls conducted by a number of organizations indicated that upwards of 70% of respondents were opposed to changing OAS.

The age of eligibility for OAS and the Guaranteed Income Supplement (GIS) will be raised from 65 to 67. This proposed change will not affect anyone who was born prior to April 1,1958. Those born on or after February 1, 1962, will have an age of eligibility of 67. Individuals born between 1958 and 1962 will have an age of eligibility between 65 and 67, with the eligibility age increasing incrementally based on year and month of birth.

Another key change to OAS will come on July 1, 2013. Individuals will be able to choose to defer their OAS pension for up to five years or age 70. Such deferral will allow these individuals to receive an actuarially-adjusted – or increased – annual pension.

Efforts will also be made to establish proactive enrolment for OAS and GIS. Currently, seniors must apply for these programs, and many miss out on benefitting from these universal programs.

Veterans
Veterans Affairs will ensure income support programs for veterans who are over age 65 will align with the changes to OAS eligibility, so that vulnerable veterans are not left with an income gap between ages 65 and 67.

The federal budget noted that the existing arrangements for housekeeping and grounds maintenance in the Veterans Independence Program (VIP) will be adjusted so that those eligible receive annual grants, paid twice per year. This will replace the current system of submitting expenses and awaiting reimbursements. While this offers greater convenience for VIP veterans, FSNA is concerned that the grants system may disadvantage some veterans, as the budget did not clearly specify that the financial advantages of the current and new systems would be the same.

More details will be available over the coming weeks and months as the parliamentary budget cycle unfolds. FSNA will closely monitor the implementation of the changes called for in the 2012 federal budget and will advocate to protect the interests of FSNA members and Canadian seniors.

“The financial impact of the recently released federal budget will have far-reaching consequences on thousands of federal public service employees, including Canadian Forces and Royal Canadian Mounted Police,” said Hélian Lizotte, FSNA National President, at the conclusion of the Board of Directors meeting in Ottawa.

Click here to read the full document.

Click here to read the full document.

Click here to read the full document.

A full complement of nine Supreme Court Justices heard the multi-billion dollar case. The Justices peppered the arguments of the appellants and respondents with pointed questions, cutting to the heart of the debate and challenging the lawyers for both sides to defend their positions. After hearing the arguments, the Court reserved its decision. The Court must now decide whether this was a matter of mere bookkeeping principles or an expropriation of billions of dollars.

Paul Cavalluzzo, Hugh O’Reilly and Amanda Darrach of Cavalluzzo Hayes Shilton McIntyre & Cornish LLP represented the Professional Institute of the Public Service of Canada and its co-litigants, including FSNA and National Joint Council Bargaining Agents. Andrew Raven, James Cameron and Andrew Astritis of Raven, Cameron, Ballantyne & Yazbeck LLP represented the Public Service Alliance of Canada and several other public service associations. Peter Southey, Dale Yurka and Christine Mohr represented the Respondent Attorney General of Canada.

In 1999, Parliament passed legislation, Bill C-78, amending the superannuation acts and enacting the Public Sector Pension Investment Board Act. The passing of Bill C-78 followed stalled negotiations between the bargaining agents, the pensioners’ representative and the employer in 1998. At the core of those stalled negotiations was how to address the matter of surplus pension funds.

The effects of the bill were to create a new pension fund for benefits earned after April 1, 2000; to create an investment board to manage amounts transferred to the government under the superannuation legislation for market investment; to improve the annuity by basing the pension calculation on the five consecutive best-paid years of service; to separate employee superannuation and CPP contributions; and to change the manner in which contribution rates are set. A key provision of the bill allowed excess amounts accumulated before April 2000 to be debited from the Superannuation Accounts. This last point is the crux of the pension surplus debate.

Under the superannuation legislation, employees contribute a proportion of their salaries to the pension fund each working year, and the government makes a payment in kind on behalf of the employee. An employee is generally entitled to a pension at retirement, based on his or her years of service and annual salary. Since pension contributions are made over the course of a career, and only paid out once an employee retires, it is possible for a surplus of funds to accumulate. It was estimated that between 36.9 and 42.2% of the surplus in the Public Service Pension Account alone was attributable to employee contributions and the interest thereof. It was also estimated that the total pension surplus grew to more than $30 billion by 1999.

A portion of Bill C-78 allowed the government to amortize the surplus funds from the CF, PS and RCMP superannuation accounts during the 1990s, and to withdraw the remaining surplus amounts. Over the course of 15 years, beginning in 1991, $28 billion in surplus pension funds were amortized and assigned to purposes other than pension funding. The unions and pensioners argued that this method of accounting allowed the government to pay down its deficit by using monies that had been set aside for pensions, while taking contribution holidays. They argued that by virtue of its role as pension plan administrator, the government had a fiduciary duty to keep the funds segregated, and to use contributions solely for the purpose of funding the pension plan.

On the government side, Mr. Southey argued that the only obligation that the government has to employees in this regard is to pay them the appropriate pension amount at the right time. There is no general right to funds that are paid in to the Consolidated Revenue Fund, other than what was promised under the pension legislation. As long as pensioners receive the pensions promised, the government is meeting its obligations. He also argued that the private law concept of fiduciary duty does not apply where the Crown has not explicitly created the duty in legislation.

For further information or inquiries, please contact Sayward Montague at 613- 745-2559 ext. 238.

For more background information, members can read a summary of the case here. The Facta, or written legal arguments for both the Appellants and the Respondents, are available here.

FSNA staff will be in attendance at the Supreme Court of Canada in order to keep our members informed regarding the proceedings and outcome.

Prime Minister Harper’s speech at the World Economic Summit in Davos, Switzerland on January 26, 2012, pointed to the likelihood of change to the Old Age Security (OAS) program.

Central to Harper’s speech was Canada’s changing demographics – an aging population and a dwindling workforce that present “a threat to the social programs and services that Canadians cherish.” The changes would be focused on the OAS, the portion of Canada’s retirement income system that is funded by government revenues, “to ensure sustainability for the next generation while not affecting current recipients.”

Since then, the government has provided some clarification.. On Friday, January 27, the Prime Minister’s Office (PMO) released a media statement to clarify the government’s intentions. “The Harper Government will ensure that seniors maintain all the benefits they currently receive. To be clear: there will be no changes to the benefits seniors currently receive.”

The statement from the PMO went on to note that the government is committed to ensuring that “any changes are done with substantial notice and adjustment period and in a way that does not affect current retirees or those close to retirement, and gives others plenty of time to adjust and plan for their retirement.”

This was followed by statements from Conservative House Leader Peter Van Loan and Minister of Veterans Affairs Steven Blaney in a press conference on Monday, January 30. Mr. Van Loan reiterated the message from Friday’s PMO statement: “All seniors should rest assured, those who collect OAS today will continue to collect it without any change. Our focus is on the medium and long-term and ensuring the sustainability of the system … [in] 10 years, 20 years and 30 years from now.”

If Canada follows the actions of France and other nations that have recently revised their public pension programs, we may see the eligibility age for OAS and other public pension programs like the Guaranteed Income Supplement be gradually raised from 65 to 67 years. It is likely that any changes will be phased in gradually so as not to pose undue hardship on people approaching age 65 who have understood that OAS will be available to support them. The income level at which OAS clawbacks begin may also be under revision.

Canada is in the midst of a demographic shift. Many Canadians are living longer, healthier and more productive lives – but there remains a population that may be made more vulnerable if changes to the public pension system are not carefully considered and our most susceptible individuals are not protected.

FSNA is vigilant and advocating actively to ensure our members’ retirement income sources are protected and to promote retirement income security for all Canadian seniors.

FSNA assisted a member whose claim had twice been denied by bringing together the member and the authorities at Veterans Affairs Canada who were administering the claims. The member’s claim was reviewed on Friday, 30 December and the member was advised by phone that same day that his claim would be one of the thirty previously denied claims that would now be paid. This positive outcome is a prime example of the assistance and advocacy we are happy to provide to our members.

Veterans Affairs Canada was restricted by stringent rules on claim eligibility and deadlines. Claimants experienced individual difficulties in obtaining medical support to complete the claim forms. These factors resulted in delayed applications and denied claims, even though these individuals were in Gagetown at the time Agent Orange was tested and were suffering from exposure-related illnesses.

Agent Orange was one of the toxic herbicides tested at Canadian Forces Base Gagetown in New Brunswick between 1966 and 1967 by the U.S. military, with permission from Canada. It is now known that exposure to this chemical can lead to skin disorders, liver problems and certain types of cancers. Members of the Canadian Forces posted at CFB Gagetown, family members who resided with them and individuals living in the surrounding communities were exposed to Agent Orange, and some of them have experienced serious medical conditions that are known to be related to that exposure.

In 2007, the Government of Canada announced a $20,000 ex-gratia payment to compensate those who were exposed to Agent Orange and are suffering from medical conditions related to the testing. In 2010, the government enhanced the eligibility criteria and extended the deadline for a medical diagnosis and the deadline for applications to June 30, 2011, allowing more individuals to become eligible for the program. Veterans Affairs Canada administered the program and was ultimately authorised to issue the ex-gratia payments until 30 December, 2011.

Click here to see FSNA’s reaction to this pension paper.

For more information on how these pension benefits are protected from inflation, click here.

This budget includes all the measures that were part of the March 22nd budget with these changes:

• The phasing out of the annual $2 per-vote political party subsidies;
• $2.2 billion for Quebec to implement the HST

The Next Phase of Canada’s Economic Action Plan announces these measures to improve the quality of life and expand opportunities for older Canadians by:

• Enhancing the Guaranteed Income Supplement (GIS) for those seniors who rely almost exclusively on their Old Age Security and the GIS and may therefore be at risk of experiencing financial difficulties. This measure will provide a new annual top-up benefit of up to $600 for single seniors and $840 for couples. This measure represents an investment of more than $300 million per year, and will improve the financial security of more than 680,000 seniors across Canada;
• Enhancing the New Horizons for Seniors Program with $10 million over two years to support projects that ensure seniors contribute to and benefit from activities in their communities;
• Changing federal rules to eliminate the mandatory retirement age for federally regulated employees in order to give older workers wishing to work the option of remaining in the workforce;
• Extending the work-sharing program and the Targeted Initiative for Older Workers to support training and employment opportunities for older workers.

Strong fiscal management will continue to be the cornerstone of the Government’s economic policy.

• The International Monetary Fund (IMF) expects that Canada will return to budget balance by 2016, one of only two Group of Seven (G 7) countries expected to do so, and considers that its fiscal prospects are among the best in the G 20;
• Maintaining a focus on balanced budgets and debt reduction will allow the Government to keep taxes low and take actions to foster long-term growth and the creation of well-paying jobs for Canadians in the future.

Plan for returning to balanced budgets

Budget 2011 proposes to build on the actions taken in Budget 2010 to return to balanced budgets by:

• Delivering more than $500 million in new ongoing savings from the 2010 round of strategic reviews;
• Taking action to close tax loopholes;
• Launching a comprehensive one-year Strategic and Operating Review of departmental spending across all of government in 2011–12.

Once completed, this Strategic and Operating Review is expected to achieve $4 billion in annual savings and allow the Government to return to balance by 2014–15, one year earlier than previously planned. Savings from the review are not recorded in Budget 2011, but will be reported on and recorded in Budget 2012 when the review is completed and savings identified.

A summary of the 2011 federal budget is posted on the Government of Canada web site.

Since the delivery of the summer issue of ON GUARD may be delayed, an electronic version has been posted on the publications Web page. Details about meetings that were advertised in branch reports included in the summer mailing are posted under the branch events listed under each local FSNA branch.

Throughout the strike period, member inquiries and FSNA membership applications can still be faxed to 613-745-5457 or e-mailed to info@fsna.com.

A list of federal government cheques that will and will not be delivered during a strike is posted on the Canada Revenue Agency web site.

The latest strike news will be posted on the web sites of Canada Post and the Canadian Union of Postal Workers.

It will be a random sample of FSNA members who will be invited to take part in this survey, which will be conducted by the Institute on Governance (IOG) on behalf of FSNA.

To help keep costs down, FSNA would prefer to use e-mail whenever possible to conduct future member surveys. If you would like to be considered for these e-mail surveys and have not already provided us with your e-mail address, please click here to send us your name, FSNA membership number, telephone number and email address.

Thank you, we look forward to serving you even better.

In a decision made public on May 5, the Supreme Court said that the plaintiffs had legal grounds to appeal the 2007 Ontario Superior Court of Justice decision stating that members of the public service, Canadian Forces and RCMP pension plans were not entitled to the $30-billion estimated surplus to have accumulated in these pension plans.

See letters sent by FSNA National President to party leaders (PDF)

See the party leaders response to our letter:

Conservative Party’s response (not received)
Liberal Party’s response (PDF)
New Democratic Party’s response (PDF)
Le Bloc Québécois Party’s response (PDF)
Green Party’s response (PDF)

Click here for 2011 Federal Election coverage

Here are some of the highlights that may have an impact on seniors:

• Low-income seniors will be eligible for a new top-up benefit to the Guaranteed Income Supplement (GIS) in the amount of $600 extra per year for single seniors and $840 per year for senior couples. This represents an investment of $300 million per year in the GIS and will improve the financial security of more than 680,000 seniors.
• Canadians saving for retirement, including self-employed Canadians, will receive help through the implementation of the Pooled Registered Pension Plan (PRPP).
• The federal, provincial and territorial governments will continue to work on options for a “modest enhancement to the Canada Pension Plan (CPP)”. Any changes to the CPP will require a consensus among governments and reflect the need to protect Canada’s economic recovery.
• Skills training will be offered to Canadian workers to reach the next stage of their careers and to find new job opportunities.
• The Targeted Initiative for Older Workers program will be extended for three years to assist older workers who may need special help to re-enter the workforce.
• The New Horizons for Seniors Program will receive $10 million in new funding over two years to encourage seniors to lead active lifestyles and get involved in their communities.
• The personal exemption for income tax for all Canadians will be raised to $10,382, saving taxes for those who need it most.
• Mandatory retirement in federally regulated industries will now be eliminated, except where age may become an occupational hazard, such as for pilots.
• The new Family Caregiver Tax-Credit will support Canadians caring for infirm loved ones – spouses, common-law partners, minor children and parents. This is a 15% non refundable credit on any amount of $2,000, providing a $300 a year saving for a caregiver.
• Former Canadian military personnel will be encouraged to find work in the construction industry through a new program Helmets to Hardhats, a Career Transition Service administered by Veterans Affairs Canada.
• The popular ecoENERGY Retrofit Homes program will be extended for one year to help families make their homes more energy efficient and to lower their energy bills.

On a word of caution, the Finance Minister said he will continue to eliminate the deficit and balance the budget by 2015-16, with specific measures to restrain the growth of government spending. Within the next year, a comprehensive Strategic and Operating Review of government spending will be conducted to realize “substantial additional savings” through “greater efficiency and effectiveness”. FSNA will monitor this review closely with an eye to protecting federal retiree pensions, health and dental benefits.

For a copy of the Supreme Court of Canada judgment, click here.

To see the object of the class actions, click here.

As of April 1, 2011, monthly rates will increase by approximately $7 for single coverage or $13 for family coverage.

Click here to access the news release issued by Treasury Board.

Click here to access The Treasury Board of Canada: Frequently Asked Questions – Changes to Pensioners’ Contribution Rates for the Public Service Health Care Plan.

Edwards was the driving force behind the implementation of the dental insurance plan for federal pensioners. “This is a man who when he became national president of FSNA in 1989 (to 1998) set three key priorities for himself: implementation of dues deduction at source, increasing FSNA’s membership to 100,000 (a 100% increase) and a dental plan for superannuates and achieved them – a true champion for FSNA and federal pensioners,” said Hélian Lizotte, current FSNA national president.

“By lobbying effectively and persistently on behalf of pensioners and seniors,” said Sylvia Ceacero, executive director of FSNA, “often meeting one-on-one with senior cabinet ministers, he directly contributed to the respect FSNA enjoys today.” She also noted he came to work at the national office almost every day of his nine-year term as national president volunteering almost 19,000 hours to FSNA.

Claude Edwards was a big believer seniors groups needed to work closely together to wield influence. Towards this end, said Jean-Guy Soulière, current Chair of the National Seniors Council and the Association’s executive director during Edward’s term as national president, “he became the prime mover behind the Coalition of Seniors for Social Equity and pushed to have a government department for seniors.”

Claude Edwards was also founding president of the Public Service Alliance of Canada in 1966 and was recognized in government circles for his leadership, consultation and negotiation skills. Other recognition includes: Officer of the Order of Canada in 1976, an honorary degree of Doctor of Laws from Carleton University in 2001 after working for its Board of Governors for some 30 years. Since 1996, the Claude A. Edwards Bursary has been awarded to deserving full-time mature students in need of financial assistance.

Biographical Notes: Claude A. Edwards

About FSNA
FSNA is the largest and most influential national advocacy group for federal retirees. As a not-for-profit association with some 175,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the public service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is to protect and enhance its members’ pensions, health and dental insurance benefits and seniors’ benefits in general.

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For further information, please contact:
Sylvia Ceacero
FSNA Executive Director
613-794-3937
sceacero@fsna.com
www.fsna.com

Topics include the dispensing of generic drugs, the day-supply dispensing limit, and the coordination of benefits with provincial and territorial plans.

For more information on how these pension benefits are protected from inflation, click here.

As is often the case whenever a new product is introduced, some glitches have surfaced, but every effort is being made to address any issues in the shortest time possible. For example, some claims could not be processed electronically until pharmacists were reminded to enter a code required to gain access to the Sun Life system.

FSNA members who encounter problems are invited to report them to National Office at 613-745-2559 as soon as possible, so they can be investigated and reported for resolution.

PSHCP members are reminded that in the event that their pharmacy does not accept electronic claims processing, they can still present their claims the traditional way, by paying the full cost up front and submitting a paper claim to Sun Life.

The electronic processing of claims is only available to those who have completed positive enrolment and obtained their benefit card. Members who are registered as users on the Sun Life Plan Member Services Web site may print additional cards from the site.

FSNA was disappointed to hear that the Ontario Court of Appeal has dismissed our appeals to challenge the authority of the federal government to withdraw the $28-billion surplus accumulated in the public sector superannuation accounts.

FSNA will meet with its co-plaintiffs to discuss possible courses of action and will provide our members with an update as developments unfold.

Click here to read the Ontario Court of Appeal’s decision.

July 6, 2010

Fellow members of FSNA,

On June 1st, the President of the Treasury Board (TB) of Canada announced that pensioners’ contributions to the Pensioners’ Dental Services Plan (PDSP) will increase from their current rate, beginning with the deduction from the pension payment for September 2010.

The then National President of the FSNA, Stan Hrabarchuk, as well as the Executive Director, Sylvia Ceacero, and the Research and Communications Officer, Charlotte Roy, were informed of this news via teleconference a few hours prior to the public announcement by the President of TB, Stockwell Day.

Click here to read the entire letter

For complete details on this change, please click on the PDSP Communiqué.

The actions challenging the age-related benefit reduction as discriminatory and contrary to the Charter of Rights and Freedoms were dismissed by the Supreme Court of British Columbia on December 23rd, 2008.

A summary of the case information is posted on the Supreme Court of Canada Web site, as well as on the plaintiffs’ lawyers’ Web site.

Friday, March 5, 2010

Fellow FSNA members,

The 2010 federal budget was tabled yesterday and I wanted to highlight some of the measures that may have an impact on you.

• The New Horizons for Seniors Program will receive $10 million over two years to support projects that focus on volunteering among seniors and projects that raise awareness of financial abuse of seniors.
• The Government said it was committed to maintaining Canada’s retirement income system strong and efficient to ensure that Canadians have the best available opportunities to save adequately and effectively for their retirement. In preparation of the Finance Ministers’ meeting in May, public consultations will be held in March to look at the main issues in saving for retirement and approaches to ensuring the ongoing strength of the system.
• The 2010-11 departmental budgets will not be increased to fund the 1.5% increase in annual wages for the federal public administration. Current employees will see their wages increase as set out in collective agreements but federal departments will be required to reallocate from the remainder of their operation budgets to fund these increases. The budget did not contain measures that would affect federal pensions or their indexation.
• There will be an additional $1 billion invested in social housing to fund construction and renovation projects for seniors, single-parent families, recent immigrants and Aboriginal Canadians living off reserve.
• As part of that $1 billion, $200 million will go toward housing for low-income seniors and $50 million for persons with disabilities.

The past few weeks have seen a flurry of information in the media concerning pensions and many of you have expressed your concern.

The upcoming budget is expected to see the government follow through on its commitment not to raise taxes and to continue with its economic stimulus package.

Click here to access the letter. (PDF)

The 2007 judgment dismissed the actions challenging the pension surplus provision of Bill C-78 that allowed the federal government to take the $30-billion surplus accumulated in the superannuation accounts of the Canadian Forces, the public service, and the RCMP.

For more information on how these pension benefits are protected from inflation, click here.

Most of the measures announced on Tuesday by The Honourable Jim Flaherty, Minister of Finance, however, are related only to the 7% of pension plans which are federally regulated. The legislative and regulatory changes proposed by the Minister of Finance will not address the pension and retirement income issues that the large majority of Canadians face. In particular, these measures will not affect the situations of the 11 million working Canadians who are not covered by a company pension plan.

The report of the federal/provincial/territorial Research Working Group on Retirement Income Adequacy, which is due in December, will provide an unprecedented opportunity for first ministers to address the issue of adequate and secure retirement income for the vast majority of Canadians.

FSNA looks forward to further federal and provincial legislation that will improve the situations of present and future retirees. FSNA will be especially interested to see legislation that will enhance the effectiveness and resilience of the CPP while ensuring it remains affordable and fair for future generations.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not-for-profit association with more than 165,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

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For further information:
Sylvia Ceacero
FSNA Executive Director
T: 613 745-2559 ext. 231
F: 613 745 5457
sceacero@fsna.com
www.fsna.com

A date is to be set for the appeal very shortly and it is anticipated that the appeal will be heard in early 2010.

The survey, which takes about 10-12 minutes to complete, will be of interest to FSNA members who may be looking for paid employment after retirement, to benefit society and/or to obtain additional income. Persons completing this on-line survey will be able to link directly to information on transitions to employment in the non-profit sector. Completing the survey will also aid Canada’s non-profit sector. A summary of the results will be available to each participant, upon request.

The HR Council serves some 69,000 charitable and community organizations and is funded by the Government of Canada’s Sector Council Program. For more information on the HR Council, visit: www.hrcouncil.ca/home.cfm

To complete the survey and to obtain a toll-free telephone number if you have any questions, visit: www.surveycentral.ca/npvs/survey.htm

The plaintiffs’ lawyers must file their legal arguments in a factum and exhibit book by May 21, 2009. The government’s lawyers must file their own factum and exhibit book within 30 days of that date. The Ontario Court of Appeal will then assign a date at which it will hear the three appeals as one case. The appeal hearing is not expected to happen before the end of the year.

As one of the plaintiffs, FSNA is contributing to the costs of the appeal, as it did for the costs of the court case that took place in 2007.

“Governments promised a strategy that would reduce the overall costs of prescribed drugs while ensuring their safety and effectiveness.” said Dennis Jackson, FSNA National President. “With total drug expenditures expected to reach $29.8 billion in 2008, and the upward trend expected to continue, the sustainability of private and public drug plans are at risk.”

The 2004, 10-year plan to strengthen health care in Canada included a commitment by governments to pursue pricing and purchasing strategies in order to obtain best prices for Canadians for drugs and vaccines. The bulk buying power of all provinces and territories would greatly reduce the costs of prescription drugs. In this context, the September 2008 Annual Conference of Provincial-Territorial Ministers of Health made the very positive announcement that there is a greater than 90% commonality amongst jurisdictional drug plans. Inexplicably, the Ministers of Health then recommended that a national approach to pricing and purchasing savings not be undertaken collectively at this time.

FSNA urges the Health Ministers to work together on a national strategy to achieve lower costs for safe and effective prescription drugs for all Canadians.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not-for-profit association with more than 165,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

- 30 -

For further information:
Francis Bowkett
FSNA Executive Director
T: 613 745-2559
F: 613 745 5457
bowkett@fsna.com
www.fsna.com

Lower income seniors will also benefit from the improvements to the Working Income Tax Benefit which will allow them to retain more of their work-related earnings.

“We are disappointed, however, that Mr. Flaherty did not change his stance on the issue of annual minimum withdrawals from RRIFs”, said FSNA National President Dennis Jackson. He continued, “By sticking with the previously-announced one-time 25% reduction to the annual withdrawal the Minister of Finance has missed an opportunity to meaningfully assist some seniors by simply deferring tax income for the government.”

FSNA supports the $500 million for Canada Health Infoway to further develop and implement electronic health records for all Canadians. This technology will significantly support seniors and help them move through the often complex Canadian health care system.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not-for-profit association with more than 165,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

- 30 -

For further information:
Francis Bowkett
FSNA Executive Director
T: 613 745-2559
F: 613 745 5457
bowkett@fsna.com
www.fsna.com

In a brief submitted earlier this month to the Department of Finance, FSNA urged the Government of Canada to provide the leadership and to take the necessary initiatives to help Canadian seniors age well and achieve financial security, now and into the future.

To that effect, FSNA submitted three recommendations regarding the Canada Health Infoway, required minimum withdrawals from Registered Retirement Income Funds, and occupational pension coverage. Click here to access FSNA’s brief.

“FSNA has been urging governments to consider a more comprehensive pension system for working Canadians”, said Dennis Jackson, FSNA National President. “The federal/provincial/territorial Finance Ministers meeting to be held in December 2008 is a significant opportunity to begin the consultations and discussions that will be required to bring about major changes to the pension landscape.”

FSNA does not believe that the one-time, 25% reduction to the required minimum withdrawal amount from RRIFs goes far enough to support seniors. “Elimination of mandatory withdrawal is needed to provide seniors with the financial flexibility and independence they deserve”, said Jackson. FSNA calls on Minister Flaherty to reconsider the mandatory RRIF withdrawal issue when preparing the Budget 2009.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not-for-profit association with more than 160,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

- 30 -

For further information:
Francis Bowkett
FSNA Executive Director
T: 613 745-2559
F: 613 745 5457
bowkett@fsna.com
www.fsna.com

Click here to see the entire letter. (PDF)

See letters sent by FSNA National President, Dennis Jackson to party leaders. (PDF)

Click here to see FSNA’s key messages for all candidates. (PDF)

See the party leaders response to our letter and key issues:

Conservative Party’s response (not received)
Liberal Party’s response (PDF)
Le Bloc Québécois Party’s response (not received)
New Democratic Party’s response (PDF)
Green Party’s Response (PDF)

Click here to see Campaign promises and projected costs (September 25)

The Federal Superannuates National Association (FSNA) welcomes those provisions in the 2008 federal budget, which address a number of concerns of seniors.

FSNA is particularly supportive of the 2008 budget measures aimed at low-income seniors. “We recognize that this budget is based on forecasts of an economic downturn so we are pleased to see the government taking positive actions such as those to increase the income exemption in the GIS program, as well as introducing an improvement in the VIP program for survivors of Canadian veterans.” said Dennis Jackson, National President of FSNA.

Also of particular interest to seniors will be the improvements to provisions under the medical tax credit and the introduction of new health-related tax measures. “It is encouraging to see the government’s response to the work of the National Seniors’ Council in the form of the allocation of an additional $13 million to the “New Horizons for Seniors” program for the express purpose of addressing the important issue of elder abuse.”

FSNA is pleased with the budget-proposal of a “Tax-Free Savings Plan” (TFSA) that will benefit today’s seniors as well as the generation of baby boomers who are now contemplating their retirement years. Those seniors currently 65 and over will have the option to use a TFSA to generate additional income that will not impact their GIS and OAS payments. Working Canadians will be able to use the TFSA as another tool in planning sources of post-retirement income.

FSNA is committed to working with all levels of government in areas that support our members and seniors in Canada. We look forward to discussions around health care commitments and social supports for seniors as the Canadian population ages.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not-for-profit association with more than 160,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

- 30 -

For further information:
Francis Bowkett
FSNA Executive Director
Tel.: 613 745-2559
Fax: 613 745 5457
bowkett@fsna.com
www.fsna.com

This decision was taken following a meeting with representatives of all the plaintiffs and their legal counsels on January 23, 2008 to further discuss the three notices of appeal that were filed on December 28, 2007 by the Public Service Alliance of Canada; by the Professional Institute of the Public Service of Canada on behalf of the other National Joint Council Bargaining agents and other organizations, including FSNA; and by the Armed Forces Pensioners’/ Annuitants’ Association of Canada in conjunction with SSEA, now the Canadian Association of Professional Employees.

It is expected that it would take at least a year before the Ontario Court of Appeal hears any appeal.

The judge concludes his 102-page decision by finding that: “the members of the three superannuation plans under the three Acts, the PSSA, the CFSA, and the RCMPSA, have no equitable interest in the superannuation accounts established under the legislation.”

The parties have 30 days to file a Notice of Appeal. The National Board of Directors will review the decision and discuss possible courses of action.
Read the Justice Panet judgement for C-78. (102 pages, PDF)

“It is with pleasure that I accept to serve FSNA and our members for a second three-year term”, said Jackson. “The delegates from Convention 07 have voted on many resolutions that will provide FSNA with the next steps for continuing success and I look forward to taking these resolutions and making them reality”.

About FSNA

FSNA is the largest and most influential advocacy group for federal retirees. As a not for profit association with some 155,000 members, FSNA is recognized by the Government of Canada as the major representative of pensioners – and their partners, and survivors – from the Public Service, Canadian Forces and the Royal Canadian Mounted Police and of retired federally appointed judges. FSNA’s mission is focused on protecting the interests and improving the benefits of pensioners.

- 30 -

For further information:
Francis Bowkett
FSNA Executive Director
Tel.: 613 745-2559
Fax: 613 745 5457
bowkett@fsna.com
www.fsna.com

The parties did not meet in court from April 2, 2007, when the last of the witnesses were examined, to May 1. During this lag period, lawyers on both sides completed their respective written submissions, which were due on April 11 and April 20 for the plaintiffs and Crown, respectively. Both parties had to submit reply-reports by April 27.

The 210-page plaintiffs’ lawyers’ written submissions offer very solid evidence in support of their claim.

The Crown lawyers claimed that there are no real assets in the superannuation accounts, that they are merely tracking accounts for bookkeeping purposes. The plaintiffs’ lawyers gave six different examples supporting the argument that superannuation accounts have real assets. These examples range from internal reports to provisions in the three concerned superannuation acts indicating that Parliament intended the superannuation plans to operate on a full funding basis.

When asked by Justice Panet to clear up the matter of reality of assets, the Crown lawyers stated that the plaintiffs’ expert witnesses were solely conveying an opinion that is not a standard in the industry and should not be of much value to the court. They further contended that this case is a question of law, and no one’s opinions should be given that much weight in the final decision.

In defending their argument that the government has not breeched any duties it may have with employees, the Crown lawyers stated, “no moneys have ever been taken out of the superannuation accounts”. They also said that the government does not have any fiduciary duties, and even if it did, all debits and credits done in the accounts are done in line with legislation. These arguments were heavily refuted by the plaintiffs’ lawyers.

Mr. Soulière’s appointment brings personal and professional pride,” said FSNA’s National President Dennis Jackson. “I have worked closely with our Executive Director over much of his 13-year tenure with FSNA and have appreciated his very effective but non-confrontational approach to advocacy on behalf of our members. His leadership has resulted in the extension of our association advocacy into provincial forums and in our membership in the Congress of National Seniors’ Organization.”

The Congress is a coalition of 10 major national seniors organizations representing more than 2 million older Canadians and for which Mr. Soulière was the spokesperson. As a member of the Congress, FSNA had been advocating for the creation of a federal seniors secretariat that could develop comprehensive policies, programs, and activities for the benefit of Canada’s aging population.

FSNA is confident that the creation of the National Seniors Council is a major step in ensuring that Canada is the best country in the world for all segments of society, including older Canadians.

Day 15 was the last day in court for the parties before they return for closing arguments on April 30. Justice Panet has also requested written submissions in advance. The plaintiffs have until April 11 to file their submissions. The Crown will have until April 20 to respond. Should the plaintiffs wish to file a Reply to the Crown’s submissions, or vice versa, they will have until April 27 to do so.

The original trial schedule gave the parties until April 13 to put in their evidence through their witnesses. However, the Crown completed its case on March 26, two weeks short of the allotted time. The Crown declined to call any expert witnesses, or any witnesses involved in pension administration. Three of the four witnesses who had been called by the Government testified in response to the argument made by the plaintiffs that C-78 breached section 15 of the Canadian Charter of Rights and Freedoms. The plaintiffs had claimed that certain sections of the legislation differentiate between the plaintiffs and employees in federally regulated private sector industries. Specifically, the legislation does not provide the same protections that are available in the federal Pension Benefits Standards Act, which prevent employers from unilaterally removing surplus.

One of the witnesses called by the Crown in response to the plaintiff’s Charter challenge was Monique Boudrias, Executive Vice-President of the Public Service Human Resources Management Agency of Canada. The essence of Ms. Boudrias’ testimony-in-chief was that, with 31 years pensionable service behind her, she remained passionate and committed about her career in the public service and would highly recommend such a path to young people today. All in all, a glowing picture was painted of the employer. However, the rewards of being a public servant are not relevant to the issue of whether public servants suffer discrimination on the basis of their employment status.

What is relevant is the Government’s willingness to exploit the perception that federal government employees constitute a privileged class of under-worked, overpaid employees. Such stereotyping is at the root of the plaintiff’s claim that public servants are discriminated against.

On cross-examination, Ms. Boudrias admitted that she was aware of the widespread negative stereotyping of public servants, and that she found it irritating, given that, in reality, they are highly committed and work extremely hard. She also agreed that public servants are not overpaid in relation to the private sector. Ms. Boudrias was also quick to agree that, given the reality of the hardworking public servant, the stereotype, which remains largely unchallenged, is demeaning, particularly as self-worth is, for many people, tied up in the work they do.

Ms. Boudrias stated that she was aware of the view held by many people that public servants have an overly generous pension plan, and agreed that this view was part of the same stereotype. She agreed the pension plan has always been taken into account by the employer as part of total compensation. She also agreed that the existence of such a stereotype meant that there was a receptive audience for any legislative change, such as the imposition of wage freezes for public servants. Ms. Boudrias expressed surprise when shown an internal memorandum in which the President of Treasury Board was reported as saying that the Government was prepared to introduce new pension legislation because ministers considered that public servants are viewed by the public as a privileged class.

Finally, Ms. Boudrias agreed that pensions were important to most public servants; that they expected their pension contributions to be used to pay pensions; and that they relied completely on the Government to look after their pension contributions.

The Crown’s final witness was Bryan Osborne, a private-sector actuary. He was called to testify about the transfer of assets and liabilities from the Public Service Superannuation Account to the Canada Post pension plan in October 2000.

In cross-examination, Mr. Osborne admitted that in 1998, he had been contacted by Treasury Board and asked to provide guidance on approaches to sharing pension surplus. Mr. Osborne had expertise on pension regulatory matters and explained that, in Ontario, any removal of surplus from a continuing pension plan requires the consent of the pension regulator. Mr. Osborne explained that when such consent is applied for, the employer must provide information on the amount of surplus attributable to contributions paid by plan members and that before the regulator will consent to payment of actuarial surplus out of an ongoing plan, it must be satisfied that surplus attributable to employee contributions remains in the plan.

Mr. Osborne testified that there is no standard actuarial method for calculating surplus attribution but that it generally involved calculating the percentage of the surplus attributable to employee contributions and the percentage attributable to employer contributions. Internal Treasury Board e-mails show that the approach explained by Mr. Osborne was quickly dropped by Treasury Board as it would have
resulted in a 60:40 split of the surplus, a split that officials termed “too rich”.

With respect to the transfer of assets and liabilities from the Superannuation Account to the new Canada Post pension plan, Mr. Osborne confirmed that he negotiated on behalf of Canada Post the amount of assets that would be transferred to Canada Post in order to cover the liabilities assumed. He also confirmed that CPC had negotiated transitional support to help defray the cost of employer contributions under its new pension plan for a period of years. He estimated the total value of this support to be in the order of $1.5 billion. Finally, Mr. Osborne agreed that assets transferred to the CPC plan produced an actuarial surplus in excess of $200 million in the new CPC plan.

The Trial will resume on April 30 when parties present closing arguments.

Scott Milne, an expert in public-sector accountancy and former auditor with the Office of the Auditor General, said that interest and actuarial evaluations have generated additional surplus in the former accounts. Although a total of about $29.18 billion has been taken by the government from 2000 to 2006, about $12.97 billion surplus is still left in the accounts. Contributions to these accounts ceased after April 1, 2000, and were channeled to the new Public Sector Pension Investment Board under Bill C-78. At that time, the surplus stood at about $31.25 billion.

Four days of trial were spent on the testimonies of Milne and Don Lee, a pension analyst with particular expertise in attribution analysis. Their testimonies support the plaintiffs’ claims that the three pension accounts have assets and that members have claims to a good portion of the surplus.

Milne’s work with the Office of the Auditor General included dealing with the Public Accounts of Canada and auditing the public service pension accounts. He explained in Court that the pension accounts are “non-budgetary” Specified Purpose Accounts, meaning that the funds in the accounts could not be used to pay for government programs or any other purpose but for the pension benefits of plan members. Specified Purpose Accounts were created under provisions in the Financial Administration Act.

Milne further testified that the accounting of the pension plans was done on the basis that the plans were funded and that their accounts disclose contributions, investment earnings, actuarial surpluses as well as the portions of such surpluses retired by the government through amortization. He also said the funds in the accounts meet the definition of “assets,” as set by the Canadian Institute for Chartered Accountants, the body that sets accounting rules in Canada.

“We don’t make bookkeeping entries for fictional or notional transactions,” he said. “They represent real transactions, substantial events.”

Next in the witness box was Don Lee who presented his attribution analysis for the three pension plans. Lee’s expertise in this area has been accepted by courts and pension tribunals.

He first explained his method of analysis, which consisted of a review of the history of each plan, the factors that contributed to the surplus and a calculation of the extent to which the surplus grew out of employee contributions. In each case, his analysis showed that a significant portion of the surplus in each account can be attributed to plan members’ contributions: 42.2% for the public service pension account, 32.1% for the RCMP account and 25.6% of the Canadian Forces account. His analysis also showed that, in each case, the employer has withdrawn more than its fair share of the surplus.

The trial, which began on February 26, was in recess for March break and resumed on March 19.

March 20, 2007

Our Ref: 10872

The Honourable Jim Flaherty, P.C., M.P.
Minister of Finance
L’Esplanade Laurier, East Tower
140 O’Connor St., 21st Floor
Ottawa, ON K1A 0G5

Dear Minister:

The Federal Superannuates National Association (FSNA) congratulates you for following through on your commitment to include in the federal budget measures that are beneficial to older Canadians and pensioners, in particular the implementation of pension income splitting and the increases to the age amount and the pension income amount.

The increase in the spousal amount is another measure of your budget that could benefit older Canadians. We also welcome the increase of the age limit for maturing RPPs and RRSPs as a step in the right direction, as well as the phased retirement provisions that recognize the changes in the demographic make-up of the workforce.

As an organization representing pensioners, FSNA feels that the already announced increases for the Guaranteed Income Supplement program need to be further enhanced and was disappointed not to find such improvements in your budget. This is one area where improvements would have directly assisted the more vulnerable older Canadians, the majority of whom are women. We will continue making
representations on this.

The provisions of the budget providing more funding for health care will benefit all Canadians, especially seniors. Health care remains their most important concern and any measure to improve wait times and better services is welcomed. FSNA strongly urges the federal government to monitor the provinces to ensure that the additional federal funding will be effectively used by the provinces.

FSNA is pleased that the budget increased funding for the New Horizons program. As a member of the Congress of National Seniors’ Organizations, FSNA has commented favourably on the results of this program. In addition, the recent establishment by your government of the National Seniors Council is welcomed by FSNA and many national seniors’ organizations. We are of course very honoured
that the Chair of this Council is our retiring Executive Director.

FSNA’s focus and objectives are related to issues of importance to pensioners and older Canadians; our comments on your budget relate specifically to measures that impact on this sector of society. FSNA is nonetheless pleased about the budget measures aimed at assisting families and at improving the environment.

A copy of this letter is being sent to the members of the Congress of National Seniors’ Organizations, to the news media, and is being posted on our FSNA’s Web site (www.fsna.com).

Sincerely,
G. Dennis Jackson
National President

John Christie, an independent actuarial consultant and Fellow of the Canadian Institute of Actuaries, was the first witness to punch a hole in the employer’s argument that no assets existed in the Public Service, RCMP, and Canadian Forces pension accounts. He told the Court that when workers were being transferred from Treasury Board to the local airport authorities and to Crown Corporations, assets were withdrawn from the federal public service pension plan to cover the costs of their pensions that went with them.

“New, independent trustees received a series of cheques and these were invested by an investment manager,” Christie said in explaining how assets were transferred from the public service superannuation account. He added that the public service pension account showed a subsequent reduction due to the transfer.

Christie sat in the witness box for three days and gave his analysis of how the public service, RCMP, and Canadian Forces pension plans were funded and managed since the 1970s. Using charts and bar graphs, he summarized the results of a series of actuarial evaluations that reported a deficit in the 1970s. He testified that this was predictable given that the actuarial calculated costs were higher than what the employer was required to contribute by law and that the actuary did not make provisions for general salary increases until 1977.

However, after 1986, the actuarial evaluations began to report surpluses. These were mainly due to changes in actuarial assumptions, and not through the employer having covered the plan deficits or shouldering unforeseen risks, according to Christie.

In fact, he demonstrated that the employer had taken what was essentially a contribution holiday, which had no provision in legislation at the time – by using surpluses generated by the funds to reduce the employer’s contribution to the plans. As well, the employer had put a cap twice on indexing for inflation in the mid- 1980s, which, given the high inflation rates at that time, caused a 6.9-per-cent reduction in pension benefits paid out to retirees. The net effect was that the plan members bore a considerable amount of the risk during this period through a lifetime reduction of 6.9% in their indexed pension.

Christie’s clear and deliberate testimony provided evidence against the startling claims made by Toronto litigator, Alan Lenczner, in his opening statement earlier in the trial. Lenczner has been retained by the Harper government to lead an extensive team of Justice Department lawyers in this case. Lenczner argued that plan members have no claim to the surplus because there was no surplus in the account in the first place but an “over-recording of liabilities.” He further argued that the pension accounts are not the pension promised by government but are mere mechanisms to track government costs. “No money flows anywhere… It’s just numbers on a ledger sheet,” he said.

Lenczner, on several occasions, raised objections to documents, procedures, and decisions that had already been agreed to in eight years of pre-trial deliberations.

Government lawyers also tried to paint the plaintiffs’ claim as superfluous by playing up on the widespread stereotype of the spoiled bureaucrats with fat pensions. “The point is, as you approach this case,” they advised the judge, “this is a generous benefit which many Canadians do not have.”

Christie pointed out that the level of the pension benefits should not be considered in isolation but rather within the actual total compensation package. He also testified that the introduction of Bill C-78 in 1999 significantly increased employee contributions to the pension plans by as much as 21%. The government
further introduced additional increases of 0.3% per year from 2005 to 2013. In contrast, changes introduced by the Act only allowed for a slight improvement in benefits to plan members in the range of 1% to 4%.

Christie, in his experience as a private consulting actuary representing both pension plan sponsors and employees, said that he has never seen a case where a significant increase in employee contributions was introduced without a corresponding improvement in benefits, especially when there were actuarial
surpluses.

The trial, which began on February 26, will recess for March break and will resume on March 19.

In mid-February, the plaintiffs, i.e. FSNA and the Federal Public Service Bargaining Agent Representatives, remained extremely confident that the facts of this case and existing legal jurisprudence would eventually result in a court decision in favour of employees and pensioners.

In a letter to Prime Minister Harper (PDF) that they wrote, the plaintiffs strongly encourage his government to intervene in this matter and spare the Canadian public any further expense and acrimony of long and protracted legal proceedings, believing that the interests of all parties would be better served in this manner.

A February 13th press release (PDF) was sent to the Media.

The Court Challenge regards the $30.2-billion surplus taken from the Canadian Forces (CF), the Public Service (PS), and the RCMP pension accounts following the adoption of Bill C-78 in 1999.

Premier Dalton McGuinty made a public statement to that effect on Friday, December 8, as he was participating in a phone-in interview during “CTV News at Noon” broadcast by CJOH.

In a letter confirming this decision not to proceed (PDF) with the proposal, Premier McGuinty said to Mr. Jackson: “I greatly appreciated your analysis and the thoughtful presentation of your members’ concerns. It was an important part of our considerations.”

In two letters sent to Premier McGuinty and the Ontario Minister of Health (PDF) in November, Mr. Jackson had urged to reconsider this proposal that would have discriminated against federal pensioners.

In the name of the Board of Directors and of all the members of the FSNA, Mr. Jackson congratulates Mr. McGuinty for listening to the concerns of federal pensioners in Ontario and looks forward to a continuing productive dialogue with its government on matters of mutual interest.

He also extends his thanks to all branches and individual members of the Association who have joined him in protesting against the Ontario proposal. Through these joint efforts, FSNA was successful in presenting its arguments and in achieving a reversal of the proposal.

November 3, 2006

Our Ref: 10446

The Honourable Dalton McGuinty
Premier of Ontario
Room 281, Legislative Building
Queen’s Park
Toronto, ON M7A 1A1

Dear Premier:

We have obtained a copy of the letter that was sent by the federal President of the Treasury Board to your Minister of Health and Long-Term Care and have read the newspaper articles relating to your government’s proposed changes to the Ontario Drug Benefit Plan affecting federal public service pensioners aged 65 and over. I am writing to express our profound dismay that the Government of Ontario intends to effectively cease coverage under the Ontario Drug Benefit Plan for federal pensioners who have drug coverage under the Public Service Health Care Plan (PSHCP).

The Federal Superannuates National Association, of which I am National President, defends the interests of federal pensioners in matters of pensions and benefits. Twenty-three of the Association’s eighty-five branches are in Ontario and each one of these branches will vehemently oppose and lobby against the proposed changes. The Association also represents all of the pensioner members in the governance of the Public Service Health Care Plan. These pensioners are wondering why the Ontario government intends to exclude them from the Ontario Drug Benefit Plan while pensioners in all other sectors of the Ontario economy will continue to be entitled to financial assistance under the Ontario Drug Benefit Plan. In effect, this would result in federal pensioners residing in Ontario having to shoulder a greater financial burden for coverage of prescription drugs as the costs of the PSHCP are shared between plan members and
their former employer. Pensioners feel this measure is discriminatory and, quite frankly, unacceptable.

Federal pensioners have contributed and continue to contribute to the Ontario economy and to the healthy financial situation of the Province of Ontario by paying their share of the Ontario income and other taxes, including the health surtaxes. While no one enjoys taxes, federal pensioners recognize that they are necessary. What they cannot accept is unfair treatment from the taxing government or inequality with their fellow citizens before the taxman.

In effect, the intended change of coverage for federal pensioners under the Ontario Drug Benefit Plan would constitute a special tax – for being federal pensioners – a tax not imposed on any other group of pensioners residing in Ontario. Further, as the average pension paid to federal pensioners is approximately $21,000 a year, this action by the Government of Ontario would not only constitute a tax without representation but a special tax imposed on a group that includes many economically vulnerable pensioners.

Mr. Premier, I hope that you and the Ontario Government will reconsider this proposal and restore the confidence that pensioners want to have in their governments and in equal and fair treatment under the law. As indicated above, the federal pensioners living in Ontario will not accept becoming “second-class citizens”.

I look forward to a favourable reply to these grave concerns of federal pensioners in Ontario. The members of our National Board of Directors from Ontario and I will be pleased to meet with you and/or your officials on this matter. There appears to be absolutely no rationale for this proposed action except to punish, for whatever reason, Ontarians who are receiving a pension from the federal public service.

Yours truly,
G. Dennis Jackson
National President

cc: The Honourable George Smitherman, M.P.P., Ontario Minister of Health and Long-Term Care
The Honourable John Baird, P.C., M.P., President of the Treasury Board of Canada

The conference explored the issue of pension splitting that would greatly benefit couples whose difference in their income is large enough to put them in different tax brackets. Under Canada’s Income Tax Act, a single-income couple pays significantly more income tax than a couple who draws the same combined household income from each of the individuals’ pensions.

More than 30 MPs from across the party spectrum showed up at the threehour conference that was organized by a common front of 17 seniors’ organizations, which includes FSNA, and during which there were discussions concerning methods of implementation of pension income splitting.

The Hon. Garth Turner, who co-chaired the conference and who was then sitting as the Conservative MP for the Halton County, posted a video of the event on his Web site. Members can access the video by scrolling down his Webcast News page and clicking the picture appearing under the heading “MPtv – October 3rd Webcast”.

Amending the Income Tax Act to allow pension splitting would be consistent with FSNA’s Standing Resolution No. 21 that calls for the superannuation acts to be amended “to allow for the spousal splitting of retirement pensions with or without marriage breakdown along the lines permitted by CPP/QPP”.

It is hoped that these actions will persuade the Finance Minister Jim Flaherty to address the issue of pension splitting in his spring budget.

Lobbying activities for pension splitting have been conducted by FSNA on a common front basis with the following retirees’ organizations:
• Air Canada Pionairs
• Alliance of Seniors
• Allstream Pensioners’ Association
• Bell Pensioners’ Group
• Canada’s Association for the Fifty-Plus
• Canadian Activists for Pension Splitting
• Canadian Association of Retired Teachers
• CBC Pensioners National Association
• COMTECH Communication Technologies Credit Union
• FADOQ – Mouvement des Aînés du Québec
• General Motors Salaried Retirees Association
• Police Retirees of Ontario Inc.
• Real Women of Canada
• The Retired Teachers of Ontario
• The Royal Canadian Legion of Canada
• SenTax

Plan members may wish to discuss payment options with their service provider. In some cases, plan members may be able to arrange to have the provider bill them for the services rendered to give them time to submit their claim for reimbursement to the PSHPC and avoid having to pay the provider in full up front.

Note: This does not apply to assignment of benefits for hospital, out-of-province and drug claims that can still be submitted by a service provider. For more details, visit the PSHCP Trust Web site.

While not all the improvements sought by FSNA members were attained, FSNA considers that the new agreement is the best that could be achieved and is a good deal for pensioners (PDF).

The renewed agreement introduces new benefits, a number of upgrades, increased flexibility, and new contribution rates for pensioners. These changes are the result of a two-year collaborative effort between the Treasury Board Secretariat, the Bargaining Agents, and the Federal Superannuates National Association. They are outlined in the PSHCP Trust Bulletin 18 (PDF).

Find our more about the new PDSP contributions and provisions (PDF) that came in to effect on April 1, 2006.

It is estimated that the appeal will be heard in early 2007 by the B.C. Court of Appeal and that the decision will likely not be issued for a further three months after that.

The plaintiffs’ lawyers are reviewing the judgment and will be considering their options. Further information can be found on their Web site.

1. 30 Billion dollar question (PDF)
2. Judge OKs memos (PDF)

The 128 documents support the plaintiffs’ argument that plan members legitimately consider that the government, as their employer and sole administrator of the pension plans, should act according to their best interests based on its trust and fiduciary obligations. According to the plaintiffs’ lawyers, the documents also show that the government instead used the surplus in the early 90s to pay down the national debt by using “opaque” and hidden accounting manoeuvres. They further demonstrate the government’s wide discretionary powers to unilaterally seize the assets from the pension accounts.

Most of these documents are statements, written by ministers and very high level government officials, on policies covering the pension plans, official statements to plan members (some in the form of information booklets), and briefings to decision makers, including memos to the President Treasury Board and correspondences between Treasury Board and the Ministry of Finance.

During this phase of the trial, government lawyers asked the judge not to admit as evidence the 128 government documents we’re submitting to the court, even though they concede to the authenticity of these documents. Instead, in an apparent effort to drag out the case for years, they want us to call the authors of all the 128 documents as witnesses during the trial.

They also tried to muddy the issue by claiming the funds in the pension accounts were “notional” or imaginary and that words in the documents are “terms of art,” meaning that the word “fund,” for example, may mean two contradictory things between two government officials or experts.

The 128 documents support our argument that plan members legitimately consider that the government, as their employer and sole administrator of the pension plans, should act according to their best interests based on their trust and fiduciary obligations. The documents also show that the government instead used the surplus in the early 90s to pay down the national debt by using “opaque” and hidden accounting maneuvers, well knowing that doing so was questionable. They further demonstrate the government’s wide discretionary powers to unilaterally seize the assets from the pension accounts.

Most of these documents are statements, written by ministers and very high level government officials, on policies covering the pension plans, official statements to plan members (some in the form of information booklets), and briefings to decision makers, including memos to the president Treasury Board and correspondences between Treasury Board and the Ministry of Finance.

Some of the documents reveal a rift between Treasury Board and the Department of Finance in the mid-90s over who has ownership of the surplus and how it should be used. Plan members will no doubt recall that the Finance Minister at the time was no other than current Prime Minister Paul Martin, whose scandal-ridden government is now busy trying to put out other fires.

The documents include copies of communications with then Deputy Minister of Finance, David Dodge (currently Governor of the Bank of Canada) and the Assistant Deputy Minister of Finance Don Drummond (currently Executive Vice-President of TD Canada Trust) arbitrarily declaring the federal government’s entitlement to the entire surplus in the superannuation accounts. These senior Finance Department officers were eventually successful in strong-arming and overiding the concerns of more hesitant Treasury Board officials and proceeded to “appropriate” the pension surplus through the implementation of obscure accounting measures. Although not explicitly mentioned in court, it is a logical
assumption that Mr. Dodge and Mr. Drummond could only have been acting at the time with the full knowledge and concurrence of then Minister of Finance and current Prime Minister Paul Martin.

In the next phase of the trial, government lawyers will be arguing that the government has full claim to the surplus. Strangely claiming that the funds in the pension accounts are “notional,” they will also be contesting the existence of the pension surplus, arguing that no actual funds or assets existed in the
superannuation accounts and that the government’s “amortization” of the surplus was a mere accounting exercise.

The documents, however, clearly contradict this claim, as many refer to “assets” and “funds” that exist in the pension accounts and some speak of the government’s use of the surplus as “a painless way to reduce the deficit.” In summarizing the contents of memos from Treasury Board, our lawyers pointed out that “the surplus was used as the single, biggest tool to fight the deficit.”

This phase of the trial ended on Friday, Nov. 18, and it is expected that the judge will take several weeks to decide whether to admit the plaintiffs’ documents as evidence and to determine their purpose. It is also expected that the judge will schedule the continuation of the trial for spring of 2006.

During the first four days of the trial that had started on Tuesday November 15, government lawyers asked the judge not to admit as evidence the 128 government documents the plaintiffs are submitting to the court, even though they concede to the authenticity of these documents. Instead, the government lawyers would like the plaintiffs’ lawyers to call the authors of all the 128 documents as witnesses during the trial.

The lawyers defending FSNA and the other plaintiffs argued against the points made by the Crown lawyers. The Judge adjourned the trial to examine the documents and promised he would soon announce whether he would admit the documents immediately or whether he would take a few months to determine which ones were admissible.

No one can predict how long it will take for this case to be settled, or even how it will end. The plaintiffs’ position was however summed up as follows by one of their lawyers, James Cameron, as he was being interviewed on CBC’s “The House” last Saturday. “Really at the heart of this case, what we are contending, is that the deductions from pay checks that were made over all those years, and the contributions that were made by employees and the employer, and the interest thereon was and is intended to be used for pension purposes. And so what – to be very clear about this, what we’re seeking is a return of those funds to those pension accounts. We’re not seeking a pay-out to any individual.”

The initial trial process, focusing on the admissibility of the “Statement of agreement”, is expected to last about five days. An adjournment of two to three months will most likely follow to allow the judge to review the issue of admissibility.

FSNA National President Dennis Jackson is attending the trial’s opening session. He, as well as the Executive Director, Jean-Guy Soulière, and the National Office Senior Research and Communications Officer, Bernard Dussault, will be FSNA’s official spokespersons on this matter.

Origin of court case
The court case challenges the pension surplus related portion of Bill-C-78 that was introduced in the spring of 1999, following failure to reach an agreement on a new pension deal between the bargaining agents, the pensioners’ representative, and the employer. The negotiations ended in December 1998 because the employer refused to discuss the matter of surplus distribution.

Arguments to be laid out during trial
The following arguments will be laid out during the trial:

The Government violated its legal obligation to use the surplus in the best interest of federal public sector workers and retirees.

The Government’s action constitutes a breach of contract in that the pension fund is part of the terms and conditions of employment governing public sector workers.

Since the active and retired pension plan members contributed in part to bring about the surplus, they are at least entitled to a part of it based equitably on their share of contributions.

Bill C-78 discriminates against public sector workers under Canada’s Charter of Rights and Freedoms.

FSNA’s position on surplus
FSNA’s position in relation to the pension surplus has always been clear and consistent: Any surplus must be shared equitably by the employer (the taxpayers), the employees, and the pensioners.

Bill-C-78 pension surplus implications
Bill C-78 introduced amendments to the superannuation acts that allowed the Minister to withdraw certain portions of the surplus from the superannuation accounts over a period of time up to 15 years. Such withdrawals could only take place for a given plan after an actuarial report on that plan was laid before Parliament. “Surplus withdrawals” have since been made at least once from each of the plans. They amount to $15.6 billions for the CF account, $10.3 billions for the PS account, and $2.4 billions for the RCMP account. This represents a total of $28.3 billions as at 31 March 2004. The latest government financial report (summer 05) shows that a $28.3-billion surplus has been “retired”.

Joint lawsuits
Three lawsuits are challenging the government’s decision to take the accumulated surplus. One was filed by the Public Service Alliance of Canada; one by the Professional Institute of the Public Service of Canada on behalf of the other National Joint Council Bargaining agents and other organizations, including FSNA; and one was filed by the Armed Forces Pensioners’/ Annuitants’ Association of Canada in conjunction with the RCMP Association and the SSEA, now the Canadian Association of Professional employees.

Because the three cases relate to the same surplus matter, the three groups of plaintiffs, the government’s lawyers, and the Court agreed that the three cases would be heard at the same time, under a single trial. Consequently, the law firms representing each of the cases have been working together and holding periodic meetings with the plaintiffs.

1. Increase in employees’ and members’ contribution rates

• On the portion of salary up to the maximum covered by the CPP/QPP from 4% to 6.4% gradually from 2006 to 2013
• On the portion of salary exceeding the CPP/QPP from 7.5% to 8.4% gradually from 2006 to 2008
  Although this matter relates to employees and members, FSNA is very concerned that this decision has been taken when the matter of the pension surplus is now before the Court and is also concerned about the significant increase in the employees and members contribution rates being implemented before an actuarial evaluation of these superannuation plans is made.

2. Decrease in the reduction applied to the retirement pension at age 65

• As explained in the above-mentioned Internet link, the CPP/QPP integration/coordination provision embedded in the three relevant pension plans will be eventually modified in order to decrease the amount of the reduction applying to the retirement pension at age 65 (or upon any earlier disablement as applicable). Indeed, the reduction factor would gradually be lowered beginning in 2008 from the current 0.7% reaching 0.625% in 2012. It is to be noted that this recommendation still needs parliamentary approval.

FSNA is very pleased with the announcement of this pension increase applicable to pensioners reaching age 65 in 2008 and thereafter. It is FSNA — through the intervention of the former pensioners’ representative (Allan McLellan) on the Canadian Forces Pension Advisory Committee — that first brought the underlying issue to the attention of the government in 2001. The matter was thereafter handled by the Public Service Pension Advisory Committee, which made a recommendation to the President of Treasury Board in June 2004.

The examinations for discovery of the Plaintiffs are scheduled to begin in September2004. It is likely that one representative will be examined in each of the three lawsuits involving the Public Service Superannuation Plan, the Armed Forces Superannuation Plan and the RCMP Superannuation Plan.

We expect that the discovery phase of the litigation will be substantially completed by the end of 2004 and we have begun developing plans for presenting this very complex case at trial. This work will intensify as the discovery phase winds down. No date has yet been set for the trial. Trial scheduling will follow a Pre-Trial Settlement Conference.

What have we Learned?
The discovery process has shed a great deal of light on how and why the Government dealt with the surplus as it did. Briefly, we now know that the Government’s approach to dealing with the surplus was intimately linked to its desire to reduce the federal budget deficit in the mid-1990’s. The Government discovered that accounting rules permitted it to quietly “amortize” the surplus and reduce the size of the stated budget deficit, even though the balances reported in the Superannuation Accounts would not be reduced. The net results, which was effectively hidden from employees was the equivalent of a contribution holiday for the Government for much of the decade – a period in which employees continued to make their contributions in full. To make maters worse, one of the basic reasons for the emergence of the surplus in the first place was wage restraint and salary freezes! By 1995, $14 billion in surplus was already built into the Government’s internal plan to reduce the deficit. None of these manoeuvres were
disclosed to Treasury Board’s Advisory Committee on Pension Reform, which included members from the federal unions.

In 1999, Treasury Board proposed a new “pension deal”, but the Department of Finance refused to permit any discussion of sharing of surplus or transferring of the existing surplus to the new pension fund. Although it didn’t say so at the time, the Government needed to use the surplus to meet its deficit reduction targets. When the employee side refused to agree the Government’s “deal”, Bill C-78 was the Government’s answer. Under this version of “pension reform”, employee contributions increased and the Government retained all the surplus which had by 2000 grown to about $30 billion.

Amendment to the Claim
In January 2004 an amended Statement of Claim was filed with the Court in the Professional Institute et al v. AG Canada action. The claim was substantially amended to reflect information obtained from Government documents and witnesses through the discovery process and to take account of recent decisions of the Supreme Court of Canada dealing with the Canadian Bill of Rights.

Our Case Because the superannuation plans are legislative plans not subject to normal pension plan regulation, the interpretation of the superannuation legislation is at the heart of the case. When “pension reform” was enacted by Parliament, legislators were informed and understood that withdrawal of the surplus would not impact on employees because the Government “owned” all the surplus, However, we now know that privately the Government recognized that employees had a basis for claiming some or all of the surplus. In an internal Treasury Board Circular, for example, Treasury Board said this about the superannuation accounts: “The ownership of the funds remains with the participants in the plan or program, at least for the portion they personally contributed and any interest applicable thereon”.

Our position is that enacting Bill C-78, Parliament did not intend to take any surplus in the accounts belonging to employees and the legislation should be interpreted accordingly. As with the interpretation of any legislation, a full understanding of the context in which the legislation operates is critical.

In this case, the factual and legal context in which the plans operate has many dimensions: pension administration; actuarial issues; employee compensation; public finance and accounting rules; and fiduciary responsibility.

We believe that a full understanding of this context and the way in which the Government exercised its power as administrator of the plans does not support the Government’s contention that it owned the surplus. We remain committed to doing everything possible to persuade the Court to reverse the largest surplus seizure in Canadian history.

Commissioner Giuliano Zaccardelli
Royal Canadian Mounted Police
1200 Vanier Parkway
Ottawa, ON K1A 0R2

Dear Commissioner:

The Federal Superannuates National Association (FSNA) is very concerned about the “Audit at RCMP raises red flags” article by Andrew McIntosh appearing in this morning’s National Post. We sincerely hope that none of the reports about billing the RCMP pension funds for expenses unrelated to pensions are true. The alleged actions would be very serious abuses of the pension fund and a breach of the rights and expectations of those who contributed to the plan and the employees who are currently contributing.

FSNA, as you know, has a membership of more than 130,000 and represents retirees from the Public Service, the Canadian Forces, the Royal Canadian Mounted Police, and federally appointed judges. Its main objective is to protect the rights and benefits of pensioners under the superannuation plans. Some 5,000 of our members would be affected by the alleged “misappropriation or misuse of RCMP pension fund”.

Since your officials are quoted as saying that the audit is not complete at this time and that there is a review and follow-up actions being taken, FSNA will not make any official comments to the news media except to say that we have expressed our concerns to you and that we are awaiting a full disclosure of the facts. As you may know, FSNA is one of the plaintiffs in a court challenge to Bill C-78, questioning the authority of the Government to “retire” the surplus from the three superannuation plans. The actions reported in today’s National Post article are similar in nature to the “retirement” of pension fund surplus and are simply not acceptable.

We expect that your review and follow-up actions will be completed promptly and that there will be a complete public disclosure of the facts. The pensioners have a right to know; indeed all Canadians have a right to know. I hope that you will keep FSNA informed of the developments in this case and I will be pleased to meet with you at your convenience.

With kindest regards,
Rex G. Guy
National President

Where is the case at?
Three lawsuits challenging the Government’s taking of the surplus in the Public Service Superannuation Plan, the RCMP Superannuation Plan and the Canadian Forces Superannuation Plan are being pursued jointly by Court Order. The Ontario Superior Court has ruled that it has jurisdiction to hear the cases and that the federal unions pursuing the case are entitled to do so to protect the interests of public servants and other federal government employees. The lawsuits are now at the “discovery” stage. The Government has disclosed several thousand documents relevant to the issues in the case and all of these documents have been reviewed. These documents include financial data and analyses of the plans as well as hundreds of documents, many at the senior level, dealing with the Government’s strategy for dealing with pension surplus. The availability of some cabinet documents remains unresolved.

Once review of the documents was completed, the oral examination phase of the discovery process commenced. The former head of the Pension Division at Treasury Board was examined under oath for a total of 10 days in February and April 2003, and the Comptroller-General has been examined on accounting and financial issues for several days in March and April. It is expected that examinations will be completed in the fall of this year.

When will the case be heard in Court?
Once the discovery phase is complete, the Court will schedule a Settlement Conference and assign a trial date. It is unlikely that the case will be tried before the fall of 2004.

What have we learned?
The discovery process has shed a great deal of light on how and why the Government dealt with the surplus as it did. Briefly, we now know that the Government’s approach to dealing with the surplus was intimately linked to its desire to reduce the federal budget deficit in the mid-1990′s. The Government discovered that accounting rules permitted it to quietly “amortize” the surplus and reduce the size of the stated budget deficit, even though the balances reported in the Superannuation Accounts would not be reduced. The net result, which was effectively hidden from employees, was the equivalent of a contribution holiday for the Government for much of the decade – a period in which employees continued to make their contributions in full. To make matters worse, one of the basic reasons for the emergence of the surplus in the first place was wage restraint and salary freezes! By 1995, $14 billion in surplus was already built into the Government’s internal plan to reduce the deficit. None of these manoeuvres were disclosed to Treasury Board’s Advisory Committee on Pension Reform, which included members from the federal unions.

In 1999, Treasury Board proposed a new “pension deal”, but the Department of Finance refused to permit any discussion of sharing of surplus or transferring of the existing surplus to the new pension fund. Although it didn’t say so at the time, the Government needed to use the surplus to meet its deficit reduction targets. When the employee side refused to agree to the Government’s “deal”, Bill C-78 was the Government’s answer. Under this version of “pension reform”, employee contributions increased and the Government retained the entire surplus, which had by 2000 grown to about $30 billion.

Because it involves statutory pension plans, the case presents a number of new and groundbreaking issues. We remain committed to pursuing the case and to reversing the largest surplus grab in Canada.

The Federal Superannuates National Association (FSNA) congratulates the First Ministers for taking their responsibilities seriously and reaching an accord on health care renewal. They placed the need for improving our cherished health care system above political bickering.

Although FSNA made recommendations to the Kirby Committee and the Romanow Commission to go further in certain areas, it is satisfied that the First Ministers are moving in the right direction to achieve what the majority of Canadians want: the renewal, improvement and sustainability of our public health care.

FSNA supports the Accord in that it will ensure that all Canadians will have access to health services on the basis of need, not ability to pay, regardless of where they live in Canada. The agreement maintains and reconfirms the principles of the Canada Health Act and the stated values of Canadians.

The Association is pleased to see that services such as home care are to be improved and that Health Ministers are being directed to determine, within 9 months, the minimum level of services to be provided for home care and palliative care. It will, however, continue its efforts towards the implementation of a universal home care program.

The Association also feels that implementing measures to ensure that all Canadians will have reasonable access to catastrophic drug coverage by the end of 2005/06 is a step in the right direction, but it would have preferred, and will continue to advocate, a universal pharmacare program for all Canadians.

The Association is reassured to see that politicians came to understand that the health care system is not about politics, but about Canadian values, and that they took steps not only to preserve our publicly funded system, but also to continue to promote healthy living.

The Federal Superannuates National Association congratulates Mr. Romanow for having listened to all Canadians and for correctly interpreting the clear message of the overwhelming majority of them who want the protection and enhancement of a publicly funded and administered health care system.

Although FSNA feels that the final report released yesterday by the Commission does not go far enough in certain areas, such as pharmacare and long-term home care, we are pleased to see that it addresses all of the recommendations made by the Association (PDF) when it appeared before the Romanow Commission, in April.

Those who oppose the major thrust of the report, including certain politicians, are not in tune with what Canadians want. These politicians are again reminded that the principles of the health care system are cherished by a vast majority of Canadians. Politics must not hinder improvements to the health care system. Canadians pay all taxes and value heath care far more than “turf wars”.

All FSNA members are asked to openly support the recommendations and advocate immediate action. At the national level, FSNA will work with the other 11 groups of the Congress of National Seniors Organizations to ensure that the Prime Minister and the federal Minister of Health live up to their recent commitments relating to the recommendations of the Romanow Commission. The Congress will also develop a strategy to ensure that all politicians are aware that the 2 million older Canadians who are members of these organizations will not accept anything else than the viable and expanded health care system outlined in Mr. Romanow’s report.

For more details on the PDSP, click here.

PRESENTED BY: REX GUY, NATIONAL PRESIDENT
FEDERAL SUPERANNUATES NATIONAL ASSOCIATION

OTTAWA, 21 FEBRUARY 2002

Speaking Notes For Rex G Guy
Thank you for this second opportunity to appear before your Committee.
Committee members who were present at the consultation meeting in Fredericton on 8 November 2001 will recall that, for logistics reasons, we were not able to make our presentation, although we tabled it for your consideration.
It is not my intention to repeat what is contained in that presentation. I will, however, expand on the points that are raised in that document and discuss some other points and, of course, I will be pleased to reply to questions at the conclusion of this brief presentation.
Here, at the table, with me is Roger Heath, who was with me in Fredericton. Roger is a research officer with our Association and he has been analysing the whole debate on the future of our health care system. I am also supported by the Association’s Executive Director, Jean-Guy Soulière and the Deputy Executive Director, Keith Patterson.
As you already have the background information on the Federal Superannuates National Association and who it represents, let me move right into my presentation.

OUR PRINCIPAL MESSAGE:
The majority of our members lived in Canada before the introduction of medicare, some 40 years ago. They know and understand the hardships that many Canadians and Canadian families faced.
Many of the individuals who are crying for drastic changes to the system were born after medicare was introduced. Many do not understand the dire consequences of destroying our system.
Our first message is: It is paramount that a comprehensive, efficient and effective public health care system be available to all Canadians, now and in the future.

OUR MAJOR FEAR:
To ensure that we implement a fair, equitable, efficient and effective health care system resulting from the on-going review, there must be the political will to make it happen.
The continuing useless, meaningless, and dangerous bickering between federal and provincial politicians must stop.
We urge our politicians to rise above who is right and do what is right.

MAJOR RECOMMENDATIONS OF FSNA
We have followed the debate on the future of our health care system very carefully and we have conducted research in many areas.
We have consulted our more than 120,000 members in the 80 branches across the country. We have discussed the issues with the 11 other seniors groups who form the Congress of National Seniors Organizations.
The 12 members of the Congress represent approximately 2 million older Canadians.
Based on this, FSNA is making the following recommendations:

1. That the five principles of the Canada Health Act be reaffirmed

The five principles are objectives and, as such, do not prevent innovation or reform, as many have complained. The five principles are to be considered as the basis for policy. They must be uniformly understood across the country, and uniformly applied to eliminate what now exists throughout this country – a different medicare system in each province and territory.

There is no doubt that the principles need re-definition to reflect today’s context and environment.

For example, “medically necessary” has a different meaning in different provinces. This alone prevents a consistent approach to the provision of uniform services across the country.

2. That more funding be provided to health care

It is our conclusion that Canadians are willing to pay more to ensure a quality health care system.

That the funding comes from federal taxes, provincial taxes, or directly from individuals is of little consequence – the taxpayer pays for everything. The money comes from your wallet and mine.

However, the money must go to health care and we must ensure that all necessary changes are made to the existing health care system. There are many changes that can be made to ensure savings and efficiencies.

I will make a few recommendations on how the system can be made more efficient and how savings can be realized.

3. That a universal Pharmacare program for all Canadians be implemented

It is our view that the implementation of such a system would save money. It is evident that there could be an increase in governments’ cost.

But, the overall cost to those who pay, you and me, we estimate would be less.

Why is that?

If the whole country buys most of its drugs in a coordinated way, very significant discounts can be achieved.

The program could encourage practices that would economize – such as reference drug prescribing.

Moreover, effective drug use reduces the demand on other parts of the system.

Furthermore – as the Committee has pointed out – we have a problem because Canadian governments have little experience with user-fees and mechanisms that truly integrate public and private insurance.

Private insurance and user fees for drugs are common in Canada. A national Pharmacare program could give us experience in such arrangements.

4. That home care be made part of the Canada Health Act

Like Pharmacare, some provinces provide home-care to some people and some provinces do not. Again, this illustrates how the current principles of the Health Act are interpreted differently and raises the issue of equitable services for all Canadians.

The restructuring of health care in the 1990s, and the ever-growing practice of earlier discharges from acute care hospitals, has resulted in an increased demand for home care. In spite of this, home care has not received sufficient funds to keep up with hospital discharges. The current investment in home care is woefully inadequate.

Government funding for home care would be seen by many as replacing private funding. This is a consideration. Let me quote from a recent presentation made by the Congress of National Seniors Organizations, of which – as mentioned earlier – we are part, to the Romanow Commission:

“Home care and home support services help seniors maintain their independence. These services delay and even prevent institutionalization while promoting the social integration of seniors.

Home care can contribute to lower costs for the health care system by reducing the pressure on acute care beds for convalescent patients; by reducing the demand for long-term institutional care by allowing some aging Canadians to maintain their independence and dignity in their own home; and by allowing palliative care patients to spend their final days in the comfort of familiar surroundings.”

5. That as much emphasis be given to healthiness as is given to health care

Healthiness, as your Reports clearly demonstrate, requires more than a well-run health care sector and involves more ministries than the ministry of health. For example education can impart valuable life-skill that will support individuals for decades. Community programs for elders can prolong independent living.

Even in its narrow definition, health care is linked to decisions that are sometimes beyond the control of health sector. For instance, easing of drug advertising rules, now under consideration by the federal government, could have a very significant impact on drug costs – especially households’ out-of-pocket expenses.

Were health care imperatives properly coordinated in the federal system, rules that limit the advertising of prescription drugs in Canada would not be eased and US ads would be blocked from Canadian cable TV.

FSNA therefore, strongly supports the Committee’s comments on the need for better co-ordination among departments and the public on health care issues.

CONCLUSION:
Health care is currently a topic of discussion in almost every household in Canada.

We are subjected to daily bombardment by news media reports predicting the end of the health care system. Reports that, on the one hand, claim that the health care system is in crisis, and on the other hand that it is not. That provinces will “go it on their own” and that we cannot afford the health care system are all, to say the least, confusing and terrifying to most Canadians.

There is need for order and objectivity in the debate. Your Committee, we feel has tried to achieve this, and we are grateful for that.

Canadians need to receive correct information if they are to participate actively and purposefully in the debate.

Again, I thank the Committee for inviting us here, but I would also like to add one last thought.

Everyone who has followed the work of this Committee must be impressed by the quality of most of the submissions that were made. There is a great deal of commitment, understanding, and common sense outside the health sector. Moreover, the Committee’s pessimism about the possibility of achieving significant efficiency gains stems not from their impracticality, but, in part, from “the attitude and the behaviour of those with vested interests in the health care system”.

We as the Federal Superannuates National Association strongly urge this Committee to recommend mechanisms for continual public involvement in health care policy. Giving people the opportunity to defend their interests may be the only way to break the present impasse.

Again, thank you for making it possible for us to meet with you today.

Withler v. Attorney General of Canada (Court No. L010910)
Fitzsimonds v. Attorney General of Canada (Court No. L011356)

The British Columbia Supreme Court has certified the above cases as class actions. If you received or were entitled to receive a Supplementary Death Benefit under the federal Public Service Superannuation Act (“the PSSA”) or Canadian Forces Superannuation Act (“the CFSA”) between April 17, 1985 and November 2, 2001, you may be a member of the classes in these actions.

What are the actions about?
Under the PSSA and the CFSA, a Supplementary Death Benefit is payable to beneficiaries of deceased federal Public Servants and Canadian Forces members. Until late 1999, the amount of the benefit payable was reduced by 10% per year for covered members who died after age 60. Since 1999, the 10% yearly reduction under the PSSA applies after age 65, rather than age 60.
The class actions challenge the age-related benefit reduction as discriminatory, contrary to the Canadian Charter of Rights and Freedoms. A similar case brought on an individual basis in the Federal Court of Canada by Mrs. Ruth Margolis resulted in a judgment for the plaintiff. The class actions are brought on behalf of all persons who are members of the defined classes.

Who are the class members?
The classes in the two actions include persons presently resident in Canada to whom Supplementary Death Benefits under the PSSA or the CFSA were paid or became payable where:
a) The participants in respect of whom the benefits were paid or payable died between April 17, 1985 and November 2, 2001, and
b) The amount of the benefit was reduced due to the age reduction provisions of the PSSA or the CFSA.

What do I need to do to take part in the class actions?
If you do not live in British Columbia, you must contact the law firm of Giaschi & Margolis at the address below by May 19, 2002 if you want to participate in the actions. If you do not contact them, you will not be able to share in any money that the Court may award in the class actions.

If you live in British Columbia, you do not need to do anything to participate. You are automatically included in the class actions. If you do not want to participate, you must opt out by May 19, 2002 by completing an opt-out notice available from Giaschi & Margolis at the address below. Giaschi & Margolis can help confirm whether you are a class member.

Giaschi & Margolis
401-815 Hornby Street
Vancouver BC V6Z 2E6
Tel: (866) 274-6547 (Toll Free)
Fax: (604) 681-4260
E-mail: publicserviceclassaction@giaschimargolis.ca or canadianforcesclassaction@giaschimargolis.ca
When contacting Giaschi & Margolis, please provide:

• Your name and/or the name of the estate you represent
• Your address
• Your relationship to the deceased
• The deceased’s name and date of death

Do I need to pay anything?
You do not have to pay any direct legal fees out of your own pocket. If the cases are not successful, no legal fees will be charged.

By agreement with the representative plaintiffs, counsel fees may be calculated at 30% of any amounts recovered. If a settlement, judgment, voluntary payment or execution or other benefit is obtained, the lawyers will apply to court for approval of a fee that is consistent with the terms of this agreement, or some lesser amount. The court will decide what amount is fair.

This arrangement compensates the lawyers for the risk they have assumed in advancing the cases and performing the legal work. The lawyers do not receive any money unless the cases are successful. Even if the class actions do not succeed, class members are not responsible for the fees of any of the lawyers involved in the cases.

Who are the lawyers for the classes?
Giaschi & Margolis
401-815 Hornby Street
Vancouver BC V6Z 2E6

Branch MacMaster
1210-777 Hornby Street
Vancouver BC V6Z 1S4

Arvay Finlay
4th Floor, 888 Fort Street
Victoria BC V8W 1H8

Who do I contact for more information?
For more information or to opt into or out of the class actions, please contact Giaschi & Margolis at the address set out above. You can also monitor Branch MacMaster’s website at:
http://www.branmac.com/pages/publicservice.html or http://www.branmac.com/pages/canadianforces.html

Mr. Guy made an obvious point; Canadian households pay all the bills for Canada’s health care – 70% through taxes and another 30% through the purchase of drugs and health services. They don’t care which level of government pays for what, only that it be done efficiently, effectively, and with respect to Canadian values like fairness.

To illustrate how badly the debate has been sidetracked, Mr. Guy pointed out that several provinces are trying to limit coverage for seniors’ prescription drugs and convalescent home care when it is clear that broad national programs for everyone would save money. A national pharmacare program for all Canadians would allow governments to negotiate the cheapest possible price, reduce wasteful prescribing practice, and diminish drug interactions. A national convalescent home-care program would save money by emptying acute care beds. “How can governments ignore programs that promise better care and reduced costs?” asks Mr. Guy.

Mr. Guy was especially critical of proposals for two-tier health care, stating that a two-tier health care system is inherently inefficient – it would have greater costs for the same level of service, it would be administratively complex and violate all five principles of the Canada Health Act.
At the same time, Mr. Guy complimented the Committee on many aspects of their analysis so far. He agreed with their finding that the health system is not as bad as many would have us believe. Like the Committee he stressed the need for reform – especially primary care reform. He also agreed that reform has been stalled by powerful interest groups, but added that bringing not-for-profit groups to the table would be a powerful way of curbing their power. “Governments should promote informed participation by households and the organizations representing them,” said Mr. Guy.

This proposal would allow governments to negotiate lower prices, refuse high-cost drugs with cheaper alternatives, and better implement effective prescription strategies. However, a national program whereby both the public and private sectors could participate would be much more effective because the private sector spends twice as much on drugs as do governments.

Public and private participation would benefit all Canadian families by lowering their drug costs and promoting intelligent prescribing practice.

Provincial and federal health ministers meeting in St. John’s today could adopt a national drug formulary and common purchasing proposal. This proposal will only affect purchases in hospitals and other government programs.

Some data on drug costs – 1998 ($ billion)
Prescription($) Drugs (%) All ($) Drugs (%)

Governments 3.9 41.5 3.9 31.5
Private Sector 5.5 58.5 8.5 68.5
Total 9.4 100 12.4 100

Source: Drug Expenditure in Canada – 1985 – 2000; Canadian Institute for Health Information, p. 7.

With a membership of 120,000, FSNA is a not-for-profit organization that represents the interests of retirees from the Public Service of Canada, the Canadian Forces, the Royal Canadian Mounted Police, and Judges, as well as their spouses.

It has also been reported that the decision is being appealed.

FSNA is currently assessing the situation for possible implications for our members. The SDB for Public Servants was recently improved along with changes to the current PS Superannuation Act.

Such a periodic review of the plan is normal. It would appear that this review would be in conjunction with a significant review of all terms and conditions of employment in the Public Service. The latest round of amendments to the plan were implemented with Bills C-71 and C-78 in 1999 and C-21 in 2000.

The Executive Director of FSNA is the pensioners’ representative on the Public Service Pension Advisory Committee and represents all Public Service pensioners. This Committee reviews all proposed changes to the Public Service Superannuation Act, and makes recommendations to the Minister. FSNA, through the pensioner’s representative and directly to the Minister, has asked that several benefit improvements be implemented.

As is normally the case, we expect that any changes to the Superannuation Plan will not reduce benefits in any way for current pensioners nor will they reduce the accrued benefits of current employees.

It is unclear at this time to what extent, if any, changes to the Canadian Forces or RCMP superannuation acts, or to the Judges Act will follow from changes to the Public Service Superannuation Act.

Bill C-33 of 1986
This Bill was not passed by Parliament. Bill C-33 would have created a Pension Management Board for the Public Service that would have determined, each year, the increases applicable on pensions earned following the passage of the Bill.

Increases were no longer to be automatically based on increases in the Consumer Price Index, but could have been somewhat less, depending on the performance of the fund.

Full and automatic indexing of pensions would have been maintained for those already retired and for that portion of the pension of a future retiree that accrued before the date of passage of the Bill.

The Public Service Alliance of Canada (PSAC) and the Professional Institute of the Public Service of Canada (PIPSC) tentatively agreed to accept the pension increase proposals in the Bill. FSNA did not – but has been accused of doing so.

The facts are:

• FSNA was not part of the agreement between Treasury Board Secretariat, PSAC, and PIPSC.
• At no time did FSNA ever agree to less than full and automatic indexing of pensions either for existing or future pensions. FSNA wrote many letters and made many representations to Ministers, objecting to the potential reduction in indexing.
• The FSNA brief submitted to the House of Commons Committee considering Bill C-33, in March of 1987, contained the following statements in relation to the Pension Management Board:
  “There must be a statutory obligation on the Pension Management Board (PMB) to provide for the full indexing of all future pensions…
  …The Pension Management Board must be provided with the authority to meet such a statutory requirement.”
• The FSNA position on this issue has always been clear and consistent: We have always insisted on nothing less than full and automatic indexing for all pensions.

Bill C-78 of 1999
This Bill, the Public Sector Pension Investment Board Act, was passed by Parliament in 1999. Bill C-78 introduced amendments to the superannuation acts, some of which allow the Government to remove certain portions of the surplus in the superannuation accounts over a period of time up to 15 years.

Such removals to any superannuation account can only take place after an actuarial report on the account has been laid before Parliament.

To date, February 2001, no such reports have been laid before Parliament and no amounts have been removed from any of the accounts.

During the debate on Bill C-78, the President of the Treasury Board Mr. Marcel Massé stated that the largest pensioner association agreed with the government’s position that the surplus belonged to the government.

During his presentation to a Parliamentary Committee examining Bill C-78, Mr. Massé held up a printout of a page posted March 10, 1999 on FSNA’s web site which he claimed showed support for his position.

It states in part:
“FSNA’s position in relation to the pension surplus has always been clear and consistent: Any surplus must be shared equitably by the employer (the taxpayers), employees, and pensioners. This position has been included in a number of letters to Cabinet Ministers and in formal presentations to Ministers. FSNA believes that forcing a decision at the Supreme Court level on “ownership” of the surplus would inevitably lead the discussion away from a question of fairness and equity. FSNA has consulted independent professional and legal experts in the pension field and has been advised that, on the basis of current legal jurisprudence, the employer can decide how to dispose of the surplus. However, it should also be noted that, under the current legislation, the employer would be required to make up any shortfalls were the plan in a deficit position. Even in a deficit situation, the Government would not be able to reduce any of the benefits to pensioners.”

This was the statement Mr. Massé interpreted to mean that we agreed with his position that, legally, the government owned the surplus.

The statement does not say that FSNA agrees that the government owns the surplus.¼br> It says that FSNA was advised by legal experts that in their opinion the government could dispose of the surplus as it wishes. It was based on their interpretation of the Superannuation Acts as they read at that time.

FSNA believes that our members have the right to know why the Association proceeds in the way that it does. The Association is forthright and honest with the membership at all times, always giving its members full and correct information. We have nothing to hide.

This Association has been accused of trading the surplus for a dental plan.

The fact is that FSNA could not trade its members’ claim to the surplus for a dental plan because FSNA has never agreed that the government has the exclusive right to the surplus. In fact, the dental plan was the result more than 10 years of lobbying effort by FSNA. It was not part of any other agreement! It is an achievement of which we are most proud!

The PDSP will process the balance remaining as a claim provided that members attach the claim settlement statement from the provincial plan when submitting their claim to the Administrator.

“It took FSNA many years of research, persuasion, lobbying, and sustained drive to convince the government of the justice of dental plan insurance for pensioners,” said Past President Claude Edwards. “While there were others that helped to persuade the government to provide this benefit, it was FSNA’s unwavering efforts that made it possible for pensioners to be covered by a dental plan similar to the one offered to federal employees.”

The existing employee dental plan was attained through collective bargaining in 1985, but was not made available to pensioners. Prior to its implementation in 1987, wage and price controls had been in effect. In accordance with the Public Sector Compensation Restraint Act, the government imposed ceilings of 6% for 1982-83 and 5% for 1983-84 on Public Service, Canadian Forces, and RCMP wage increases. As a result of a legal challenge, the Federal Court decided that certain allowances that had been frozen by the government should have been treated as wages and allowed to increase by 6% and 5%, a judgement that was later upheld by the Federal Court of Appeal. In lieu of adjustments to these allowances, the government and the unions negotiated an out-of-court settlement. This resulted in a major change to the Public Service Dental Plan, including the elimination of employee premiums (employer’s contribution went from 50% to 100%).

Between the time the Restraint Act was imposed in June 1982 and the time the revised plan was introduced in June 1988, 50,222 employees retired from the Federal Public Service. They never received any financial benefit from this Federal Court of Appeal decision and subsequent out-of-court settlement between the union and the government.

Although there was merit in FSNA’s case, the financial climate that prevailed at the time was not favourable to the provision of dental benefits to pensioners. When it became apparent in the 90′s that the Government was moving to a balanced budget, and that the fiscal problems of the Government were lessening, FSNA redoubled its efforts to obtain this long-sought benefit for pensioners. This led to the February 1999 announcement of the Pensioners’ Dental Services Plan (PDSP).

All those in receipt of a pension under the Public Service, the Canadian Forces, or the Royal Canadian Mounted Police superannuation acts are eligible for coverage.

The other plaintiffs are: The Professional Institute of the Public Service of Canada, the Canadian Merchant Service Guild, the Federal Government Dockyard Trades & Labour Council (East), the International Brotherhood of Electrical Workers, the Federal Government Dockyard Chargehands Association, the Research Council Employees’ Association, the Association of Public Service Financial Administrators, the Professional Association of Foreign Service Officers, the Federal Government Dockyard Trades & Labour Council (West), the Translator’s Group Canadian Union of Professional and Technical Employees, the Social Science Employees Association, the Canadian Association of Professional Radio Operators, the Canadian Air Traffic Control Association and the Canadian Military Colleges Faculty Association.
On June 26, 2000, Ontario Superior Court Justice Paul Lalonde handed down his decision on the matter of jurisdiction in the Pension Surplus Case.

Justice Lalonde rejected all of the employer’s preliminary grounds relative to the employer’s position that the Ontario Superior Court did not have jurisdiction to hear the case.

Barring a successful appeal, this means the case will proceed. We will inform you of developments.

• April 2000
  Employee’s salary adjustment under the agreement for the period April 1, 1989 to 28 July 28, 1998. This cheque will also include a 5% lump-sum payment covering any possible personnel actions such as overtime, promotions and acting appointments for the period 1 April 1989 to 31 March 1994*.
• June 2000
  Pay rates that took effect 29 July 1998, plus a retroactive payment for the period 29 July 1998 to the present.
• August 2000
  Retroactive amount for the period 8 March 1985 to 31 March 1989, as well as a 5 per-cent lump-sum payment in lieu of recalculating personnel actions such as overtime, promotions and acting appointments during this period.
  (The third retroactive period predates the first two because it must be calculated manually and therefore takes longer to tally. The first two payments can be done automatically by the pay system.)
• July-October 2000
  Salary adjustments based on the recalculation of personnel actions such as overtime, promotions and acting appointments from 1994 to 29 July 1998.
• November-December 2000
  Interest on all previous payments. Canada Savings Bond interest rates will be used, with calculations based on the applicable rate for each six-month period.
  As well, pensions and disability insurance benefits will be adjusted, starting in late 2000 and through 2001.

* The 5-per-cent payment goes to everyone to avoid the administrative nightmare of recalculating the thousands of variables inherent in 230,000 separate cases over a 15-year period.

FSNA would have preferred if the Minister of Finance had eliminated these claw backs altogether.

Along with the restoration of full indexing, middle income tax rates will be lowered and the tax bracket thresholds will be increased – a positive effect for many seniors. There will also be automatic increases in the GST credit.

The Minister announced increased transfers to provinces for health care and while FSNA welcomes this increase in funding, it will remain to be seen how effective this is at repairing our damaged health care system.