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Pensions—The Plan from 2018

A pension from the Teachers’ Pension Plan is the biggest asset most members will have. The plan has two partners: the BCTF and the Government of BC. The Partners identified in 2012 an opportunity to make changes to the plan that will result in a substantial improvement for the majority of active plan members.  Leading up to March 2015, pension trustees, BCTF Executive, BCTF Staff, Teachers’ Pension Plan Advisory Committee (TPPAC), and BC government analyzed a wide range of options.  The Partners decided to task the BCTF to consult all plan members. The goal of the BCTF Executive Committee was to arrive at a revised pension plan design that would be the best possible option for the current and future active members, one that addresses the concerns of members, and does not exceed the cost parameters agreed upon by the two Plan Partners.  Having identified an opportunity for pension improvement, the BCTF Executive Committee recommended to the 2015 AGM the following motion that was passed:

Recommendation 27―Teachers’ Pension Plan design changes
That the Federation undertake a thorough consultation with members regarding possible plan design changes to the Teachers’ Pension Plan in the 2015–16 school year, with recommendations to be brought to the 2016 AGM.

Plan improvement is particularly important given that the original 1966 design of the current plan does not match the demographics of current plan members. Teachers’ Pension Plan (TPP) provided data that the model of entering the plan very early and retiring very early does not happen to the same degree and does not reflect the reality of current TPP members. It is also important given the detrimental impact the plan’s calculation link to the Canada Pension Plan (CPP) number, Year’s Maximum Pensionable Earnings (YMPE), is having on all plan members’ pensions. TPP data helped support the conclusion that whenever salary increases do not match YMPE increases, the member’s lifetime pension value erodes. This is a real risk that must be addressed urgently. Other public sector pension plans in BC and across Canada are making similar changes to their pension plan for similar reasons.

The BCTF, with feedback from the Partner and TPPAC, planned an extensive province-wide consultation of all plan members that spanned September to December of 2015.  In addition to the 90 consultation sessions, members were provided resources that included, the presentation materials, data tables, video tutorials, access to BCTF Executive Committee and BCTF Pension Staff.  The BCTF Executive Committee recommended to the 2016 AGM the following motion that was passed:

Recommendation 30—Pension formula design change
That the Teachers’ Pension Plan design change of the pension formula include:
  1. delinking from the Canada Pension Plan’s Year’s Maximum Pensionable Earnings (YMPE).
  2. a single accrual rate of 1.85% be applied to Pensionable Service.
  3. an Early-retirement Reduction Factor of 4.5% for every year under 61.
  4. removal of the 35-year Pensionable Service cap.
  5. an unreduced pension for those with 35 years of Contributory Service.