The following is a guest blog post by Colin Craig, former Alberta Director for the Canadian Taxpayers Federation. In this post, Craig responds to a recent blog post by Calgary City Councillor Shane Keating about city council's golden pension plan, and Keating's recent comments about the city's retirement bonuses.

It's very disappointing that Calgary City Councillor Shane Keating continues to spread false information – we should expect better of our elected officials.  

In this guest blog post, I’ll draw your attention to some false statements made by Keating in his blog post about council's pension plan. Further, I'll draw attention to another false statement the councillor made recently. 

 

1) Keating’s Pension Calculation

In his recent blog post, Councillor Keating told you half the story about the cost of city council’s pension.

In short, Keating claims the cost to taxpayers for council’s pension works out to roughly $20,340 per year.

If you multiply that by 15 city council members, that works out to around $305,100 per year. (The actual total for the main council pension would be a bit higher as the mayor earns more money than a city councillor, but this figure can serve as an adequate rough estimate.)

Now consider that if you turn to page 57 of the City of Calgary’s 2010 Annual Report you’ll see that taxpayers paid $1,535,000 for council’s pension that year.

And if you turn to page 72 of the City of Calgary’s 2013 Annual Report you’ll see that taxpayers paid $1,067,000 for council’s pension.

So how could the cost in those years be more than three times what Keating is telling you?

Pensions are a bit complicated, but the short answer is that council has a costly type of pension plan that guarantees council members golden payments each year throughout their retirement.

If council’s pension plan doesn’t have enough money to pay for those payments, the city simply dumps more money into council’s pension plan – as it did in 2010 and 2013.

While these extra payments cost taxpayers a lot of money, Keating’s calculation ignores them.

If you look at page 19 of this document – click here – you’ll see an email from the City of Calgary’s Chief Human Resources Officer to Councillor Keating. Towards the bottom of the page, the email notes that if there is a shortfall (“unfunded liability”) in council’s pension, “the City would be required by the EPPA to make payments into the EOPP trust fund in order to bring the EOPP to fully funded status.”

Thus, taxpayers are taking on a significant liability for ensuring council's pension payments are protected throughout their retirement years. 

There are other shortcomings with Keating’s work, but the only other part that I’ll touch on is Keating’s criticism of Farkas.

What people need to remember is that Keating was elected in 2010 – he’s part of city council’s establishment.

Farkas is a young councillor who was elected in 2017 and has been trying to shake things up at city hall; he routinely challenges the status quo and speaks up consistently for taxpayers.

Note that when Farkas was elected last year, he announced that he would not accept council’s golden pension. This seems to have really angered a lot of veterans on city council as it makes them look bad. Here they are feasting at the trough while a young council member comes along and refuses the golden benefit.

And don’t forget, Keating is a retired school principal. Thus, it’s quite likely that he will not only receive a golden city council pension, but also a generous pension from his school division days – one that taxpayers have to pay for as well.

If anyone should have refused accepting a second taxpayer-funded golden pension, it’s Keating.

  

Keating Needs to Read City Reports

Since Keating was elected in 2010, every single City of Calgary Annual Report has noted that city employees receive an “allowance” when they retire.

I dug into this issue earlier this year to learn more about the so-called “retirement allowance” and discovered it’s a golden payout that is paid to city employees when they retire. The benefit averaged $10,814 in 2017 and has nothing to do with an employee’s performance on the job.

To be blunt, the perk is so ridiculous I had a hard time believing what I read about it.

When I blew the whistle on the perk in July, many council members indicated they had no idea it existed, including Keating.

At the September 24 council meeting (see 13:03:50 mark), Keating tried to dismiss his ignorance of this costly perk by suggesting he shouldn’t be expected to know “every tiny tidbit” about what goes on at the City of Calgary.

That’s a fair statement – no one expects him to know small expenditures such as city hall’s spending on toilet paper.

However, this golden “retirement allowance” is anything but a “tiny tidbit.”

It costs taxpayers about $8 million per year and has a liability that stands at about $73 million.

How could Councillor Keating be on council for so long and not know about this $73 million issue?

Again, this bonus has been written up in every annual report put out by the city since Keating was elected.

Why doesn’t he read those reports?

What other major issues are out there that Keating doesn’t know about?

  

Conclusion

Councillor Keating likes to claim others are out there spreading “false” information.

It seems pretty clear to me – he’s doing a great job of spreading it himself.

 

P.S. – For those interested in learning more about council's pension, I recommend reading this report – click here