WEDNESDAY, FEB. 15: White collar government workers will today meet to discuss a plans for an eight per cent pay cut and a freeze in pension contributions.

The Bermuda Public Services Union (BPSU) will discuss the Government proposals – and any counter-proposals from the union.

BPSU president Kevin Grant said: “When it comes to one’s pension, people are concerned about what will happen if pension contributions are frozen for a year.

“There are a lot of our members who getting near their retirement and they have questions about how it will affect them.”

Mr Grant added that members had put questions to the union after the offer from Premier and Finance Minister Paula Cox was made public and that negotiators had been in talks with Government over the implications of the cost-cutting deal.

He said: “I can’t say what the members are feeling totally, because I hear from members and they well aware of what’s happening globally. A lot of jurisdictions are cutting government staff left, right and centre.

“But they do have some concerns going forward.

“We’re aware that government needs to find some way to deal with cost-cutting — that’s imperative. We also know the pension fund itself has probably been underfunded since its inception.

“That needs to be reviewed in order to reach a sound judgement on how the fund should be run in the future, contributions and whether there has to be any changes in legislation.

“A suspension of contributions is something some people may be able to deal with, but others will have concerns which need to be addressed.”

Mr Grant declined to discuss what counter-proposals the union could suggest to government — but he hinted it is likely that members may back some changes to government’s original proposal.

He said: “I can’t discuss the actual proposals, but as Government puts together some innovative proposals, my executive and negotiating team have decided to do the same thing.”

But he stressed: “A decision of this magnitude has to be decided by the members. I can’t really say how it will go — but what needs to happen is we need to provide the facts, all the information, so our members can make an informed decision.”

And Mr Grant said: “If we don’t embrace change, then we will be forced to adopt change.”

Ms Cox – in a bid to save an estimated $31 million – said government would freeze both employer and employee pension contributions for a year and cut government salaries by eight per cent.

Take home pay

The unpaid staff pension fund contributions would offset the eight per cent pay cut, so take home pay would remain the same.

The total unpaid contributions by employees would also total around $31 million.

She later announced that PLP parliamentarians had agreed to a package of cuts totalling 17.5 per cent — a freeze on pension contributions “with a commensurate reduction in gross salary” plus an additional five per cent pay cut – and challenged the Opposition to do the same.

OBA Craig Cannonier backed a five per cent salary reduction — and said his parliamentary team would start putting five per cent of their salaries into a special account and donating the proceeds to charity from March 1.

But he said the Opposition would not support a pension contributions freeze for MPs and Senators or government workers.

Mr Cannonier said: “If the current proposal to the unions goes through, the government workers pension fund will lose more than $60 million in contributions this year.

“Failing to support the civil service pension fund for a year is a raid on the future and it’s not right. It will create a deficiency that will more likely affect younger taxpayers. A one year pass on pension contributions will not alter the Government’s serious financial problems. It will only push the problem further down the road.”

The PLP has accused the Opposition of playing politics on the issue.

In a statement, PLP MP Walter Roban said: “The OBA once again show their true face as opportunists less interested in the public good than in their own political agenda.”

 

The BPSU meeting is due to be held at 4pm in the St Paul AME Centennial Hall in Hamilton’s Court Street.