Interested in Indexation?
Inflation protection in your pension plan
We all know the cost of living is increasing. However, our retirement plan is not keeping up.
SHEPP is one of the only health care pension plans in Canada without indexation. With no mechanism for indexing, your pension income stays the same no matter how much the cost-of-living increases.
SHEPP retirees have not had any increases to their pension since 2003 – resulting in a loss of roughly 1/3 of their purchasing power to inflation.
In 2021, the average benefit received by SHEPP retirees aged 65 and older was $16,798 per year with no indexing to keep up with inflation. This can hardly be considered a “gold plated pension.” The average age of SHEPP retirees is 71.8 years and most have never seen an increase in their benefit.
We are facing staffing shortages in every classification – improving retirement security for future retirees will help recruit and retain health care staff.
The five health SHEPP Partner Unions (CUPE, HSAS, SEIU, SGEU, and SUN) have joined together to call for improvements to the pension plan.
After 20 years of deficits, the plan will approach a surplus situation by 2025.
Currently, there is a special payment of 2.94% being directed to paying off plan deficits. Now that the plan is in a better fiscal position, there is an exceptional opportunity to redirect funding into plan improvements at no extra cost to plan members or the employer.
The cost of living has increased in the past two years. This is the perfect time to strengthen SHEPP and establish cost of living adjustments (indexation) for future pension service and new commitments to retirees with past pension service.
We need your help:
Stay tuned for further pension updates on www.cupe5430.ca and our Facebook page www.facebook.com/cupe5430.