CUPE National’s Response to the U of S Article on Pension Contributions


The University states that the pension “has cost the University an additional $29.7 million beyond normal contributions over the past decade.”

The Union has always acknowledged the cost of these additional contributions, which were largely the result of the 2008-09 economic crisis, the worst economic downturn since the Great Depression. In this spirit, in the 2013-14 round of bargaining, the Union offered changes to the plan that would have seen Union members shouldering about half of the University’s special pension payment obligations – but the University rejected this proposal.

The email also fails to mention the fact that from 1993-2009, the University took 17 years of “partial contribution holidays” (using pension plan surpluses to pay portions of the University’s annual required pension costs). In total, the University used nearly $28 million of pension surpluses to cover portions of their own pension costs over this period.

The University should not be selective when discussing the plan’s history. To only reference a challenging period following a historic economic downturn, when University contributions to the plan were higher, is narrow and potentially misleading. They should also speak about the long period before the downturn, when the pension was in surplus and their contributions were reduced by using this surplus.

And we should also speak about a better future. The Union believes we should learn from this history and allow plan surpluses to remain in the plan. This would allow future plan surpluses to function as a reserve against future downturns, all in the hope of preventing future increases in contributions.

The University also claims that “these significant additional contributions are expected to continue moving forward under the plan’s current structure.”

As the plan returns to a healthier funding position after the 2008-09 economic downturn, the University’s required pension contributions are actually falling. The most recent actuarial report on the plan shows that University pension contributions will be about $3 million lower in 2018 than they were the previous year. The actuary projects that further reductions to the required Employer contribution will take place in 2023 and 2027.

The Union continues to work towards a pension solution that addresses the University’s concerns but also protects the secure defined benefits that are so important to our members.