BCTF Pension Plan · Prince Rupert DTU 44 53 S Okgn Smlkmn TU 30 54 Bulkley Valley TU 80 55 Burns Lake DTU 60 Nechako TU 70 Prince George DTA 100 ... 31.1% 17.4% 1.5% 0.0% 0% 5% 10%

Report to the BCTF Winter RA,

January 29–30, 2016

BCTF

Pension Plan Consultations

Introduction

BCTF Pension Plan Consultations 2

• The 2015 BCTF AGM passed the following motion:

“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 year, with recommendations

to be brought to the 2016 AGM.”

• extensive province-wide consultation of Teachers’

Pension Plan (TPP) members

• final report preview.

The Teachers’ Pension Plan


• members 40,644 active, 7,525 in-active, 32,050 pensioners

• Joint Trust Agreement (JTA) since 2001

• two partners: Plan Member Partner, BCTF

Plan Employer Partner, Government of BC

• partners appoint Teachers’ Pension Board of Trustees (TPBT)

• TPBT responsible for plan governance

• BCTF Trustees: three active BCTF, one BC Retired Teachers’

Association (BCRTA) member, and one excluded employee

(BC School Superintendents Association [BCSSA] or BC

Principals’ and Vice-Principals’ Association [BCPVPA])

• BCTF trustees on Teachers’ Pension Plan Advisory

Committee (TPPAC).

Advisory Meetings

(November 2012–January 2016)


• TPBT and Plan Partners:

November 5, 2012, and six additional meetings

• Plan Partners:

December 6, 2012, and 12 additional meetings

• All Partners of public sector pension plans:

October 2, 2013, and two additional meetings

• TPPAC:

November 29, 2012, and 17 additional meetings

• BCTF Executive Committee:

December 12, 2014, and 16 additional meetings

• BCTF AGMs, RAs, 2015 Summer Conference:

March 17, 2014, and nine additional meetings.

Consultation sessions


• September 14–December 7, 2015

• locals, sublocals, repeats, and special requests: 87.

No. Local Name Attendees

1 Fernie DTA 14

2 Cranbrook DTA 80

3 Kimberley TA 30

4 Windermere TA 20

7 Nelson DTA 27

10 Arrow Lakes TA 18

17 Princeton DTU 20

18 Golden TA 35

19 Revelstoke TA 30

20 Kootenay Col TU 52

22 Vernon TA 80

23 Central Okanagan TA 250

27 Cariboo-Chilcotin TA 1. 85

2. 35

28 Quesnel DTA 100

31 Nicola Valley TU 30

33 Chilliwack TA 150

34 Abbotsford DTA 200

35 Langley TA 160

36 Surrey TA 400

37 Delta TA 40

38 Richmond TA 1. 60

2. 70

391 Vanc Elem STA with 1. 150

392 Vanc Sec TA 2. 80

40 New Westminster TU 100

41 Burnaby TA 1. 77

2. 105

42 Maple Ridge TA 100


43 Coquitlam TA 1. 150

2. 80

44 North Vancouver TA 400

45 West Vancouver TA 55

46 Sunshine Coast TA 40

47 Powell River DTA 50

48 Sea to Sky TA 1. 35

2. 25

49 Central Coast TA 15

50 Haida Gwaii TA 15

51 Boundary DTA 55

52 Prince Rupert DTU 44

53 S Okgn Smlkmn TU 30

54 Bulkley Valley TU 80

55 Burns Lake DTU 60

56 Nechako TU 70

571 Prince George DTA 100

572 Mackenzie TA 22

573 McBride-Valemount TA 12

591 Peace River Sth TA 30

592 Chetwynd TA 25

593 Tumbler Ridge TA 40

60 Peace River Nth TA 45

61 Greater Victoria TA 100

62 Sooke TA 75

63 Saanich TA 80

64 Gulf Islands TA 6

65 Cowichan DTA 50

66 Lake Cowichan TA 22


67 Okanagan Skaha TU 200

68 Nanaimo DTA 170

69 Mount Arrwsmth TA 75

701 Alberni DTU 36

702 Ucluelet-Tofino TA 40

71 Comox DTA 100

72 Campbell River DTA 50

73 Kamlps Thmpsn TA 60

74 Gold Trail TA 1. 25

2. 20

75 Mission TU 35

78 Fraser-Cascade TA 35

80 Kitimat DTA 35

81 Fort Nelson DTA 43

83 North Okanagan-Shuswap TA 40

84 Vancouver Isld W TU 17

85 Vancouver Isld N TA 10

861 Creston Valley TA 25

862 Kootenay Lake TA 8

87 Stikine TA 10

881 Terrace DTU 1. 5

2. 46

882 Upper Skeena T 12

92 Nisga’a TU 12

93 SEPF 28

Admin Admin–Sooke and S Islds 27

Admin Admin–VEPVPA 40

Admin Admin–BCSSA 120

Admin Admin–BCPVPA 120

Member feedback


Sessions:

• engage members in education and feedback

• EC member & presenter

• presentation: 1.25 hrs; questions: 1.5 hrs.

Online survey:

• purpose to inform and guide EC

• 4,700 responses (more later).

Emails:

• inquiries: general, conceptual, and financial

• [email protected], approximately nine per day.

Phone calls:

• BCTF Income Security Division, approximately eight per day.

Pension Consultation Survey 2015 (preliminary)


Part 1: Demographic characteristics of respondents

* BCTF calculations with data from: Ministry of Education. 2014/15 Teacher Statistics, pp. 2–3.

Survey respondents vs. provincial data

88.1%

10.2%

1.7%

92.8%

7.2%

0.0% 0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Teacher Administrator Unknown

Teachers and Administrators as a percentage of all educators— Survey respondents vs. Province

Survey respondents Province (2014-15)*

Gender


How do all respondents in the survey compare to the province—by gender?

58.9%

34.7%

0.1%

6.4%

71.6%

28.4%

0.0% 0.0% 0%

10%

20%

30%

40%

50%

60%

70%

80%

Female Male Other No answer

Gender, all respondents (n=4,452) Survey sample vs. Province

Survey respondents (All; n=4,452) Educators (Ts and Admin) - Province (2014-15)*

Age group


How do all respondents in the survey compare to the province—by age group?

0.6%

13.0%

24.5%

41.7%

18.5%

0.9% 0.9% 0.5%

17.6%

31.8% 31.1%

17.4%

1.5% 0.0%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Under 25 25-34 years 35-44 years 45-54 years 55-64 years 65 and over No answer

Age group - all respondents (n=4,452) Survey sample vs. Province

Survey respondents (All; n=4,452) Educators, Province (2014-15)

Years teaching in BC


0.8%

8.7%

12.9%

33.3%

43.7%

0.6% 2.4%

17.6%

23.8%

34.0%

22.1%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Less than 1 year 1-4 years 5-9 years 10-19 years 20 or more years No answer

Years teaching in BC - Teachers (n=3,921) Survey sample vs. Province

Survey respondents (Teachers, n=3,921) Province (2013-14)

0%

Source of information


Sources of information respondents accessed prior to completing the survey

8.3%

22.5%

30.2%

48.4%

15.3%

50.1%

0% 10% 20% 30% 40% 50% 60%

Other; please describe

I have accessed my personal account information on the TPP website

I have read information about the TPP on the TPP website

I have read information about the BCTF Pension Consultation on the BCTF Pension Consultation website

I have not yet attended, but plan to attend, a BCTF Pension Consultation seminar

I have attended a BCTF Pension Consultation seminar

Source of information about the Teachers' Pension Plan Consultation (Percentage indicating Yes, for each option, out of 4,452 respondents)



Part 2: Pension Consultation survey data

Option A—Accrual rate 1.8%, ERF of 3.0% per year before age 61

15.0%

36.4%

8.9% 10.7%

21.7%

7.3%

13.8%

36.5%

7.5% 9.2%

19.4%

13.6% 14.4%

36.4%

8.2%

10.0%

20.5%

10.4%

0%

5%

10%

15%

20%

25%

30%

35%

40%

1st choice 2nd choice 3rd choice 4th choice 5th choice 6th choice

Percentage who chose OPTION A as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 3,553)

Attended Did not attend Total sample




Option B—Accrual rate 1.8%, ERF of 3.5% per year before age 61

2.2%

11.5%

35.6%

29.5%

17.9%

3.3% 1.9%

13.5%

37.1%

25.0%

19.6%

2.9% 2.0%

12.5%

36.4%

27.3%

18.7%

3.1%

0%

5%

10%

15%

20%

25%

30%

35%

40%


Percentage who chose OPTION B as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 3,515)





Option C—Accrual rate 1.85%, ERF of 4.0% before age 61

7.2%

16.1%

27.9%

34.0%

12.5%

2.2%

7.3%

13.4%

25.4%

38.6%

12.5%

2.8%

7.3%

14.8%

26.7%

36.3%

12.5%

2.5%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%


Percentage who chose OPTION C as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 3,512)





Option D—Accrual rate 1.85%, ERF 3.0% per year before age 62

4.5%

21.9% 21.5%

18.6%

30.2%

3.2%

5.7%

18.9%

21.8%

19.2%

30.5%

3.9% 5.1%

20.4% 21.6%

18.9%

30.3%

3.6%

0%

5%

10%

15%

20%

25%

30%

35%


Percentage who chose OPTION D as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 3,490)





Option E—Accrual rate 2.0%, ERF of 5.0% per year before age 62

30.3%

10.5%

2.8% 2.4%

14.4%

39.6%

23.5%

13.1%

4.4% 3.6%

15.0%

40.3%

26.9%

11.8%

3.6% 3.0%

14.7%

40.0%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%


Percentage who chose OPTION E as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 3,552)

Attended Did not attend Sample total




Option F—The current plan with no changes

52.8%

4.1% 2.4% 2.8% 2.0%

35.8%

56.3%

4.7% 3.8% 3.1% 2.0%

30.1%

54.6%

4.4% 3.1% 2.9% 2.0%

33.0%

0%

10%

20%

30%

40%

50%

60%


Percentage who chose OPTION F as their 1st, 2nd, 3rd, 4th, 5th, or 6th choice: whether they attended a Pension Consultation session (n = 4,221)

Attended Did not attend Sample total

The BCTF Executive Committee

recommends to the 2016 AGM:


That the Teachers’ Pension Plan design change of the pension

formula include:

a. delinking from the Canada Pension Plan’s Year’s Maximum

Pensionable Earnings (YMPE)

b. a single accrual rate of 1.85% be applied to Pensionable Service

c. an Early-Retirement Reduction Factor of 4.5% at age 61

d. removal of the 35-year Pensionable Service cap

e. an unreduced pension for those with 35 years of Contributory

Service.

Supporting statement

The TPP Joint Trust Agreement specifies the partners of the pension plan

as Plan Employee Partner, BCTF; and Plan Employer Partner, BC

government. Pension plan design changes must be acceptable to both

partners. They have agreed that any plan design changes must not

exceed the Total Actuarial Cost of 22.28%

The recommendation has these

features acceptable to Partners:


• Total Actuarial Cost of recommendation 22.24%

• delink from CPP’s YMPE number.

o 1966 pension formula linked our plan to the YMPE

o good, if salary increases match YMPE increases

o not matching and causing pension erosion

o eliminate split rate system

o part-time/low income earners are now not

disproportionately adversely affected

o current plan effective accrual rate of 1.51%.

continued …




• 1.85% single accrual rate

o highest pension build up rate possible within

actuarial costing.

• 4.5% Early-Retirement Reduction Factor (ERF)

at age 61

o actuarially neutral ERF > 6.75% at age 60

o current plan ERF 3% at age 60

o move towards neutralizing subsidy of early

retirement.

continued …




• 35-year package in response to member feedback

o 35-year cap removal on Pensionable Service

further removal of employment restriction

all employment increases pension.

o 35 years of Contributory Service = unreduced

pension

o Purchase of Service has full value

o Child Rearing Credit has full value

o go forward basis.

The BCTF Executive Committee

recommends to the 2016 AGM (repeat)


That the Teachers’ Pension Plan design change of the

pension formula include:

a. delinking from the Canada Pension Plan’s Year’s

Maximum Pensionable Earnings

b. a single accrual rate of 1.85% to be applied to

Pensionable Service

c. an Early-retirement Reduction Factor of 4.5% at

age 61

d. removal of the 35-year Pensionable Service cap

e. an unreduced pension for those with 35 years of

Contributory Service.


Documents

BCTF Pension Plan · Prince Rupert DTU 44 53 S Okgn Smlkmn TU 30 54 Bulkley Valley TU 80 55 Burns Lake DTU 60 Nechako TU 70 Prince George DTA 100 ... 31.1% 17.4% 1.5% 0.0% 0% 5% 10%