Alberta NDP introduces bill to reverse teachers’ pension transfer to AIMCo

The Alberta New Democratic Party’s labour and immigration critic is attempting to reverse the provincial government’s plan to transfer teachers’ pensions to the Alberta Investment Management Corp.

Christina Gray, an NDP member of the legislative assembly for Edmonton-Mill Woods, introduced Bill 203, called the Pension Protection Act, on Monday. The legislation, if passed, would undo a portion of the United Conservative Party’s Bill 22, which mandated that the Alberta Teachers’ Retirement Fund transfer its assets to the AIMCo’s management. The omnibus bill, passed in November, also prevents any public sector plans from withdrawing from the AIMCo’s management.

Gray’s bill would require a current or future government to consult with pension holders before making any changes to the plans’ administration. It would also prevent Alberta from withdrawing from the Canada Pension Plan, which the province is considering under its so-called Fair Deal panel.

Read: Proposed Alberta Pension Plan has underwriting, political risks: report

“The UCP, the party of the free market, is choosing to force all Albertan pensioners to use AIMCo rather than allowing them the opportunity to have competition within the market,” said Gray at a press conference. “They are creating a monopoly.”

In the legislature, she said the government’s changes had “terrified tens of thousands of teachers who earned their pensions over a lifetime of hard work.”

Gray’s bill comes as the AIMCo faces criticisms for substantial losses on a volatility strategy that performed poorly amid the coronavirus pandemic-related equity market turbulence in the first quarter of 2020. Kevin Uebelein, the AIMCo’s chief executive officer, said in a late April press release that the investment manager lost approximately $2.1 billion, though actual losses wouldn’t be finalized until the strategy is wound down by mid-June.

The AIMCo declined to respond to Benefits Canada‘s request for comment.

Read: AIMCo calls reports of losses on volatility strategy ‘dramatically’ overstated

Alberta’s Finance Minister Travis Toews hit back at Gray’s assertions in the legislature on Monday. “The reality is, there’s not a pension management firm that has not experienced a real challenge in Q1 of 2020. In fact, . . . AIMCo’s returns in eight of the last 10 years have beat the benchmark.”

In a note to members posted on its website, the ATRF confirmed it hadn’t yet transferred its assets to the AIMCo. “We are in the process of transferring our asset management to AIMCo as the government of Alberta has required us to do, but that transfer has not completed so ATRF assets have not suffered as a result of the AIMCo losses reported in the media,” said Sandra Johnston, ATRF’s board chair, in the note. “I want to reassure ATRF members that we continue to work diligently on their behalf doing everything we can to ensure this transfer will not harm the long-term stability of our plans and the security of their pensions.”

In November, the ATRF and the Alberta Teachers’ Association called for the province’s auditor general to examine the asset transfer proposal.

Read: Alberta teachers calling on auditor general to investigate proposed public pension changes