As you may be aware from previous AMCTO Express communications, AMCTO and other similar staff associations and organizations have been raising concerns for the past several years regarding the lack of representation for the Management/Unaffiliated group of OMERS Plan members on the Boards of the OMERS Sponsors Corporation and the OMERS Administration Corporation. We have consistently identified that this lack of specific representation is particularly unfair given the fact that more than 20% of all OMERS Plan active members fall within this specific group. As a result of this lack of representation, Management/Unaffiliated OMERS Plan members have historically had no input into decisions regarding their OMERS benefits or contribution rates.
AMCTO has recently learned that the OMERS Sponsors Corporation, which has the responsibility for determining benefits and contribution rates for the OMERS Plan, is currently considering a number of proposals for Specified Plan Changes. As members of the OMERS Plan, these proposed changes will have a significant impact on you and your future retirement plans.
Of particular interest to most AMCTO members are the following proposed changes, each of which has been put forward by certain employer representatives on the Sponsors Corporation:
- Reduce Pension Benefit Indexing to 50%- While the OMERS Primary Plan is in a deficit position, it is proposed that the current 100% automatic indexing of pension benefits by the CPI increase in the previous year be reduced to 50%.
- Delay Early Retirement Eligibility – Under the Primary Plan and RCA, members in respect of service after December 31st 2015 and employees becoming members of OMERS after December 31st 2015 shall have their eligibility for unreduced early retirement modified so that no unreduced early retirement option may be exercised, in the case of NRA 65 member, before the age of 60.
- Reduce Annual Benefit Accrual Rate– Starting in 2015, a reduced multiplier of 1.85% (currently 2.0%) would be applied in the pension formula for any earnings above the Yearly Maximum Pensionable Earnings amount set by the Canada Revenue Agency.
Further details regarding these three proposed changes (and two others regarding pension eligibility for paramedics and police civilians) and their rationale and impact can be found on the OMERS Sponsors Corporation website at www.omerssc.com/PlanChanges/4783.aspx.
As the Management/Unaffiliated Group of OMERS members (which includes most AMCTO members) does not have a representative voice at the Sponsors Corporation Board table, if you have concerns regarding any of these proposed changes, you are encouraged to bring your concerns directly to the attention of the Sponsors Corporation. These concerns should be directed by telephone, e-mail or in writing as follows:
OMERS Sponsors Corporation
One University Avenue
Toronto, Ontario M5J 2P1
Tel: (416) 814-6584
Fax: (416) 369-1156
Toll-free: 1-800-387-0813 ext. 6584
Your concerns should be brought to their attention at the earliest opportunity as the Sponsors Corporation will be completing their technical research and due diligence regarding these various Specified Plan Changes by no later than May 14th 2013. Following the completion of this due diligence, at meetings to be held between May 15th and June 30th 2013, Sponsors Corporation Board members may amend, withdraw, approve, reject or move any Specified Plan Change to mediation/arbitration. Approval of a Specified Plan Change requires a two-thirds majority while a rejected Specified Plan Change requires a simple majority to move to mediation/arbitration.
As an OMERS Plan member without representation at the OMERS Sponsors Corporation table, this is your only opportunity to ensure that your interests are taken into consideration.
Please share this Express with others in your municipality who will also be affected by these proposed Changes.