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Time to cut costs by reining in golden government benefits

Author: Franco Terrazzano 2020/02/21

Premier Jason Kenney needs to pull Alberta out of its $70-billion debt hole.

While there are few easy things to cut, Kenney can reduce costs without impacting frontline services by scaling back golden government benefits. The on-going contract negotiations between the government and the United Nurses of Alberta is the perfect time for Kenney to start reining in perks.

There’s no doubt that nurses provide valuable services. But most Albertans would be laughed out of the office if we approached our boss asking for the type of benefits Alberta’s government nurses are receiving.

For starters, UNA nurses are getting two pensions.

Like most government employees in Alberta, nurses are eligible to receive a defined-benefit pension plan where they are guaranteed – thanks to taxpayers – specific payments throughout their retirement. The nurses’ own pension plan accurately describes itself as “quite generous” and “a substantial workplace benefit at a time when most Canadians have no workplace pension at all.”

On top of their generous defined-benefit pension, UNA nurses also receive a second retirement payment from taxpayers in the form of RRSP or TFSA contributions for up to two per cent of their earnings. This could add more than $1,850 every year to the retirement of each top registered nurse.

Nurses are also eligible to receive overtime pay without working full-time hours. In Alberta, part-time nurses have specific days-off, known as Designated Days of Rest. Any hours worked on those days trigger double-time pay, even if the part-time nurse hasn’t worked full-time hours.

This policy has cost more than $77 million since 2014 and increased the salaries of eligible nurses by about $4,000 on average in 2018, according to a freedom of information request obtained by the Canadian Taxpayers Federation.

In the real world it’s tough to imagine a part-time employee being paid overtime when they pick up an extra shift, especially in today’s economy. Nobody is asking government employees to work for free, but part-time employees shouldn’t receive overtime pay when they haven’t even worked full-time hours.

Full-time UNA nurses are also receiving additional lump sum payments worth $1,750 every year and nowhere in the recent Letter of Understanding between the government and union is there any explanation of why taxpayers are on the hook for these special payments. In fact, it appears that every full-time UNA nurse is eligible for these bonuses, regardless of performance. Part-time and casual nurses receive payments based on the number of hours they work.

The CTF estimates that these bonuses for full-time nurses cost taxpayers about $20 million every year (based on 43 per cent of Alberta nurses being full-time and number of AHS UNA nursing positions).

These extra perks add up quickly for nurses and taxpayers. A top UNA registered nurse is eligible for about $20,000 in “benefits/pension/lump sum” payments every year, according to another freedom of information request obtained by the CTF.

The lucrative benefits are layered on top of salaries that are higher in Alberta than other provinces. A registered nurse in Alberta can earn up to $48.37 an hour. That works out to about $92,900 every year, which is more than $8,000 higher than the same nurse in British Columbia who works the same number of hours.

For all five UNA nursing positions government data was provided for (licensed practical nurses are not under the UNA), Alberta’s maximum hourly salary rates are higher than those in every other province (the one exception are graduate nurses in Ontario).

Albertans appreciate all the hard work nurses do. But struggling taxpayers shouldn’t be forced to pay for special benefits. These golden perks are proof that there’s still places Kenney can cut before frontline services are impacted.

This column originally appeared in the Edmonton Sun on Feb. 21, 2020.


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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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