BUFA Member: I've heard that BUFA is trying to negotiate changes to our maximum allowable pension. What's that all about?

Answer: At the present time, your pension is limited by the maximum allowed under the Plan of $1722 times years of service. This limits the amount of your salary which is pensionable. As of now, any salary above about $97,000 is not pensionable. That is, for a member at the top of the Full Professor range, about $25,300 or 20% of your salary is not pensionable. At retirement, your pension will be 20% less than it could have been. For someone at the top of the Associate range, the shortfall is only about 4% of salary and Assistant Professors are not affected ...yet. But they will be. Every BUFA member will eventually be affected unless the maximum allowable pension is changed.

Most other University pension plans do not have a set dollar maximum, i.e $97,000. Instead their maximum is the maximum set by legislation. Brandon University is rather unique in having a set dollar amount limit. Current legislation allows a maximum of $2222 per year of service which translates into pensionable earnings of about $125,000 (greater than the current top of the Full Professor scale). This legislated maximum will rise with inflation in the future. The limit in the Brandon University Pension Plan will not. The situation will not improve ...unless BUFA is successful in negotiating changes.

BUFA Member: But why BUFA? Why don't the Pension Trustees do something about it?

Answer: BUFA does have two members on the Pension Trustees. The Pension Trustees oversee the operation of the Plan and can make recommendations about how to spend large surpluses in the Pension Plan. However, they can't recommend the spending of money that's not in the Plan. The only way to make improvements to the Pension Plan in the foreseeable future is through collective bargaining.

BUFA Member: But I'm almost 20 years from retirement and won't hit that salary for quite a while. Why should I care?

Answer: Using a long term average salary scale increase of 4%, (This is a number commonly used by actuaries in their calculations), it would take about 18 years for salary scales to double. At that time, the maximum pension would affect every BUFA member from the IA I through to the Full Professor.

Someone retiring at the top of the Full Professor scale would have a pension based on only about 40% of their income.

Someone retiring at the top of the Associate Professor scale would have a pension based on about 48% of their income.

Someone retiring at the top the Assistant Professor scale would have a pension based on about 62% of their income.

Someone retiring at the top of the IA III scale would have a pension based on about 85% of their income.

So regardless of your rank when you retire, you will be seriously affected.

"First they came for the Full Professors, but I was not a Full Professor, so I did nothing. Then they came for the Associate Professors, but I was not an Associate Professor, so I did nothing..........."

Prospective BUFA Member: I've just been offered a job here as an Assistant Professor. I'm 35 years from my normal retirement age. Why should I care?

Answer: Consider someone just starting at Brandon University at age 30, who stays here until retirement at age 65. Using the 4% annual increase in salary scales and assuming normal promotion through the ranks, at retirement, the pension that you will receive would be based on only 26% of your salary. Your pension will be about one quarter what it should be. And remember, the pension is only partially indexed. Any increases after retirement depend on stock market fluctuations.

The big reason to attack the problem of maximum pension is not to help the "old farts" who are close to retirement age. It's the younger members who will reap by far the most benefits.

In 35 years, your maximum possible pension will be the exact same dollar amount as the maximum possible pension today, but the cost of living will be four times what it is today. Why would anyone take a job at Brandon University knowing that their pension, after dedicating their life to the institution, would be one quarter of what would be available almost anywhere else?

Prospective BUFA Member: Why indeed! I'm outta here.