Oh Oh, Another CUPE Strike Issue Arises
Who is going to pay for the massive $8B loss that OMERS, the municipal employees pension plan, suffered last year and when:
- "The Ontario Municipal Employees Retirement System (OMERS) which manages more than 380,000 retired and working employees in Ontario has announced today a massive $8.01 billion loss for 2008 (a negative return of 15.3% for the year), compared to a net profit of $3.94 billion in 2007 (an 8.7% return in 2007). The dramatic loss is simply attributable to the global economic downturn, which saw global equity marks down up to 40% according to OMERS CEO Michael Nobrega. The fund also underperformed due to massive losses in its fixed income and real estate investments. The fund also said it specifically avoided subprime mortgages, and CDOs (collateralized debt obligations) that have mainly contributed to the global recession."
In addition, there was another problem:
- "At the end of 2008, OMERS Primary Plan had a funding shortfall of $279 million."
Remember several years ago the end of the OMERS contributions holiday and the massive increases in contributions that both employers (Cities like Windsor ie taxpayers) and workers (CUPE members) had to pay that impacted City budgets for years. That loss was only $600M!
I assume that CUPE will be asking now for contributions rate protection in their new agreement or the proposed City increase in salary could mean a reduction in salary over the years once OMERS contributions are factored in!
The note above shows what the change will be dealing only with the $279M matter. Hmmmm, interesting that this information never reached the Council Communications Package.
As for us, dear reader, we get hammered both ways. More taxes for increased worker contributions via salary increases and increased property taxes to pay for the City's contribution.
Years ago I suggested to Council an alternative to OMERS to the City but no one took me up on it. It is time that it be reconsidered since it would help both CUPE AND Taxpayers.