Second and third pensions for municipal employees in Alberta costing taxpayers millions

“For the vast majority of Albertans working outside of government, we don’t even have workplace pensions,” said Franco Terrazzano, Alberta director for the CTF.

“I think it’s really crazy to think that while so many people are struggling, so many families are struggling, so many businesses are just struggling to keep their doors open, taxpayers in Alberta are paying into second and third pensions for thousands of city employees across the province.”

Terrazzano told Lethbridge News Now that the CTF is asking city mayors and councillors to “do the right thing” and end what he calls these “golden perks”.

He said there are many reasons taxpayers should care about this.

“It’s costing us a lot of money, In 2019, it cost us nearly $25-million across the province for the second and third pensions, and that was just an annual cost, so this is a cost that’s hitting us every single year,” he said.

“Besides just the cost of these second and third pensions, it’s just not fair. It’s not fair for the many Albertans outside of government who have been struggling not just for a few months, but really for the last five years. These are types of perks that really should have never been put into place in the first instance.”

He suggested that councils needing to find any savings should look at cutting the second and third pension options.

“W can’t be asking struggling taxpayers to be paying more money for government employees to get not just one, but second or third pensions.”

Below is a break-down of pensions per different municipalities, including Lethbridge, in 2019.

(Canadian Taxpayers Federation)

“There’s a number of cities that are offering not just one and not just two pensions, but even three pensions. You look at Calgary; [they’re] offering its employees three pensions. Lethbridge, for example, you have more than 150 employees that were set to receive two pensions, then you have 11 employees that are in the triple-pension plug,” Terrazzano said.

He added one city of note is Red Deer.

“While they have employees that are set to receive three pensions when they retire, they actually ended that third pension for future employees, so it can be done, we can see cities scale back the golden perks and really, we need to see all cities across Alberta looking to find savings and looking at these unfair perks and putting an end to them,” he said.

The first pension available is the Local Authorities Pension Plan (LAPP), while the second is the APEX Supplementary Pension Plan. That is the most common second pension plan and tops up the Local Authorities plan.

Calgary and Edmonton are not included within the APEX plan, but both municipalities offer their own top-ups.

The third pension is the Overcap Supplementary Executive Retirement Program (MuniSerp).

The CTF says this program is 100 percent funded by taxpayers and supplements the LAPP and APEX pension plans. The City of Calgary offers a similar plan.

The full report by the Canadian Taxpayers Federation is available here.

by Justin Goulet

Second and third pensions for municipal employees in Alberta costing taxpayers millions

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