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Tuesday, December 17, 2013

Pensioners Could Get Cost Of Living Increase

It might not entirely quell their fears about the Shared Risk Plan--but retirees who had been receiving pensions under the Public Service Superannuation Act could receive a cost-of-living increase in 2014 equal to 100 per cent of the inflation rate under the new plan.

The cost-of-living increase will depend, however, on how well the plan is funded, but in a release Finance Minister Blaine Higgs claims the new plan is designed in such a way that the likelihood of providing annual cost-of-living increases is very high. Effective Jan. 1, 2014, retirees' pensions will increase by 0.96 per cent  based on the average change in inflation.

Higgs says if a shared risk model had been adopted 20 years ago, the cost-of-living increases  retirees received would have been the same as what they were under the former plan.