05/06/2014 01:43 EDT | Updated 07/06/2014 05:59 EDT

Alberta Pension Reform Needs More Discussion: Horner


EDMONTON - The province's decision to shelve two pension reform bills should not be seen as defeat but as recognition of the public's concern, Finance Minister Doug Horner said Tuesday.

"It's not a matter of whether we backed down, or who won or who lost," Horner said at a legislature news conference with Guy Smith, head of the Alberta Union of Provincial Employees.

"This is about making sure the process is right."

Horner made the comments a day after the government sent Bill 9 and Bill 10 to an all-party standing committee for public hearings this summer.

The bills, with any amendments, could come back as early as the fall sitting.

Horner said the decision was made after the province heard increasing concerns from stakeholders, including unions, about the proposed legislation.

"It became pretty evident that there's a lot of misinformation that's out there. There's a lot of discussion that has to happen. And ... there's some trust that has to be rebuilt."

Last week, the government backed away from using legislation to impose lean pay increases on the union during contract talks. The province had sought a four-year deal with wage freezes for two years followed by two years of one per cent wage hikes.

The bill to impose a contract brought a blistering attack from the union. In February, a judge ruled the law violated good-faith bargaining.

In the end, the two sides tentatively agreed to a lump-sum payment of $1,850 per employee in the first year, followed by a total 6.75 per cent wage increase in the final three years of the deal.

Smith said the pension bills, the labour contract and another law imposing severe fines for talking about illegal strikes have severely strained labour relations with the province.

But, he added, things are turning around.

"I'm open to having discussions about rebuilding that relationship on an honest respectful level," said Smith.

"We'll see. The trust level is still extremely low."

One of the proposed pension amendments in Bill 9 would allow private-sector plan operators to convert previously accrued defined benefits into targeted benefits.

The union says another in Bill 10 would open the door to drastically reducing benefits through a contribution cap and by eliminating inflation-proofing provisions.

There would also be higher penalties for those who retire early.

The union's case received a major boost when Calgary Mayor Naheed Nenshi sent a letter to Premier Dave Hancock urging Bill 9 be shelved.

Nenshi said the changes could "gravely impact" his city's workforce. The mayor suggested workers would either retire or move to other jobs en masse before a reduced pension kicked in.

Asked about the impact of the Nenshi letter, Horner replied: "Actually, not too much." He noted that Edmonton Mayor Don Iveson supported the changes.

Calgary, however, is a key political stronghold for the Tories, who have bottomed out in recent polls following the resignation of former premier Alison Redford in a spending scandal.

NDP Leader Brian Mason, along with other opposition parties, had promised to filibuster the bills, but withdrew that plan Monday after the province announced its intentions.

Mason said the Tories have long struggled with controversial bills because they don't consult properly to begin with.

"(This) government legislates first and thinks second, and that's gotten them in more trouble than they know," he said.

With the pension bills off the table, the house is expected to break for the summer on Thursday — a week ahead of schedule.

A bill to broaden investigations and public reporting on the deaths of children in care is still expected to pass, said Human Services Minister Manmeet Bhullar.

Opposition Wildrose Leader Danielle Smith said the withdrawal of the bills shows the government is treading water until the Tories pick a new leader in September to replace Redford.

"It's a government at complete standstill," said Smith.