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EDMONTON, Alberta — The Alberta Government’s changes to the AIMCo board without consultation with the unions representing members of the Local Managers Pension Plan (LAPP) and Public Sector Pension Plan (PSPP) show a deep disregard for the fact that the pension funds are owned by Alberta workers and retirees, not the government.
Pension security depends on the ability of trade unions, through a co-management model, to make decisions about how public pension funds are managed. The 2019 reforms (Bill 22) undermined corporate governance to allow state interference and risky political investment.
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Originally the jointly owned LAPP Corporation would have the ability to change investment providers if it determined that it was in the best interest of plan members. The Alberta government in 2019 locked them into AIMCo, however, saying AIMCo would deliver better results. Now they say AIMCo is inefficient and inefficient. Member unions have not been affected by any changes.
“Removing the ability of pension plans to walk on their own feet undermines pension security,” said CUPE Alberta President Rory Gill. “The solution to the AIMCo operation is to restore the right of pension scheme members to choose who will manage their pensions, not for government ministers to continue to interfere with political appointments.”
LAPP has shown that it is better equipped than politicians and AICo to make investment decisions. While AIMCo suffered huge losses in early 2020, LAPP’s investments did not experience similar losses because LAPP used its low hedging strategy – despite still being required to use AIMCo as an investment fund manager. These LAPP decisions save the pension fund approximately $1.9 billion.
“Politicians must stop putting their politics into our pensions. “Workers and retirees need their hard-earned money to be focused on recovery and trust, not risking that money to achieve the political goals of the current government,” said Gill. “This government needs to restore independent decision-making for pension schemes, not bring in a Minister to manage AIMCo.”
View the source version on businesswire.com: https://www.businesswire.com/news/home/20241108910948/en/
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