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Thread: An Alberta pension

  1. #1

    Default An Alberta pension

    This is an old idea. Seems to have come back from the dead:


    Braid: Alberta pension a serious idea that would flip out the feds | Edmonton Journal
    Excerpts:

    “In Kenney’s scenario, the pension fund would be administered by the Alberta Investment Management Corporation, AIMCo. He said it’s a successful world-class institutional investor with more than $100 billion under administration ($115 billion, according to the latest AIMCo report).”

    Kenney said, “I understand there is about $40 billion of Albertans’ premiums under management by Canada Pension Plan Investment Board.

    “If we could transfer those assets to be managed securely by AIMCo, that would also help AIMCo be a stronger asset manager that would be able to participate in larger deals . . . to further diversify their investment portfolio and improve returns over time,” he concluded.“...


    “ Government officials suggest there could be a strategic advantage for Alberta development. With many lenders shunning oil and gas, AIMCo might buy more stakes in the industry.

    But economist Trevor Tombe points out that the first duty of these big institutional investors is to make money, and plenty of it. Decisions made for political reasons deserve to be “a genuine scandal.”...

    https://calgaryherald.com/opinion/co...p-out-the-feds
    Last edited by KC; 06-11-2019 at 10:24 AM.

  2. #2

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    Why it never got implemented when Harper called for it? It does appear to be a good first step to stomp your feet at Canada. You get AIMCo close to $150B with an already existing NDP economic development mandate and you get to become a sort of Caisse. AIMCo has already provided $300M to the usual suspects of the oil patch under that mandate.

  3. #3
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    I want my pensions to be profitable and sustainable, and not necessarily to serve as oil & gas industry welfare. Potentially a horrific proposal.
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  4. #4

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    Appropriating everyone's futures to prop up an industry when informed investors are pulling their money out.

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  5. #5
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    Bad idea.
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    I'm somewhat indifferent about whether Alberta starts up it's own pension fund or not. But doing so, in order to shovel money at the energy industry, is the definition of stupidity. One of the most important factors in investment is diversification. Investing Alberta's pension money in the local energy industry is the exact opposite of diversification.

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    Look at the history of the alberta heritage trust fund. Then imagine an alberta pension plan.
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  8. #8

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    Quote Originally Posted by Bill View Post
    Look at the history of the alberta heritage trust fund. Then imagine an alberta pension plan.
    Hahaha!
    Good one!

    Put it all into General Revenues and we can work for our pensions. Everyone wins! At the same time de-index the pension payments, sorry, I mean pension salaries.
    Last edited by KC; 06-11-2019 at 06:35 PM.

  9. #9

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    I think I read somewhere that AiMCO is investing in that Edmonton Motors development. So if that's their plan going forward (diversification of investments) and NOT just putting all the money into oil & gas, maybe this could work?

    The Ontario Teachers Pension Fund is a good case of diversification of investments.

    I'm not 100% knowledgeable on this matter so maybe what I've just said is clueless.

  10. #10

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    Contributors should have a say in their pensions & it shouldn't be entirely in the hands of a crony capitalist government to use as a thumb on the scales of the free market.
    Giving less of a damn than ever… Can't laugh at the ignorant if you ignore them!

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    Quote Originally Posted by EdmontonsKindaGuy View Post
    I think I read somewhere that AiMCO is investing in that Edmonton Motors development. So if that's their plan going forward (diversification of investments) and NOT just putting all the money into oil & gas, maybe this could work?

    The Ontario Teachers Pension Fund is a good case of diversification of investments.

    I'm not 100% knowledgeable on this matter so maybe what I've just said is clueless.
    It's very common for pension funds to invest in large rental buildings, whether by lending/financing the construction, purchasing them after they're completed, or outright developing themselves. Again though, pension funds should be investing in a diversified portfolio, both in terms of the kinds of assets and in terms of geographical location. So AIMCo should absolutely not be "encouraged" to specifically invest in projects in Edmonton or Alberta, unless the investment makes sense on it's own terms.

    Quote Originally Posted by noodle
    Contributors should have a say in their pensions & it shouldn't be entirely in the hands of a crony capitalist government to use as a thumb on the scales of the free market.


    It's not like we have much "say" over the CPP. But agreed in terms of the concerns specific to the UCP.
    Last edited by Marcel Petrin; 08-11-2019 at 09:51 AM.

  12. #12

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    Quote Originally Posted by noodle View Post
    Contributors should have a say in their pensions & it shouldn't be entirely in the hands of a crony capitalist government to use as a thumb on the scales of the free market.
    The UCP was elected by a massive majority of voters - following the NDP being elected by that same voting population. It’s hard to make the case that Albertans are victims of crony capitalism. The UCP may even have a greater majority than the government(s) that enacted the federal pension model even had.

  13. #13
    Giving less of a damn than ever… Can't laugh at the ignorant if you ignore them!

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    Quote Originally Posted by KC View Post
    Quote Originally Posted by noodle View Post
    Contributors should have a say in their pensions & it shouldn't be entirely in the hands of a crony capitalist government to use as a thumb on the scales of the free market.
    The UCP was elected by a massive majority of voters - following the NDP being elected by that same voting population. It’s hard to make the case that Albertans are victims of crony capitalism. The UCP may even have a greater majority than the government(s) that enacted the federal pension model even had.
    I'm not sure what the proportion of voters that voted for the government has to do with whether or not it practices crony capitalism. Just because a government enjoys broad popular support doesn't mean that it's not corrupt. See Hungary and other central/eastern European countries. It's way too early in the UCP's tenure to say that they're practicing it. But if they start using public assets to subsidize chosen industries/companies, then that's the definition of it.

  15. #15

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    Quote Originally Posted by Marcel Petrin View Post
    But if they start using public assets to subsidize chosen industries/companies, then that's the definition of it.
    They've already started, that's the entire raison d'etre of the War Room & the FOIP Firewall around it.
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    i want to stay in cpp. might i have to leave the province then?
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  17. #17

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    deleted duplicate post
    Last edited by KC; 08-11-2019 at 02:05 PM.

  18. #18

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    I’ve long pondered the idea that Alberta could add to CPP it’s own supplemental pension with near equivalent payout terms (but with a lower balance).

    Wondered what the effect might be on equalization too if it somehow lowered taxable wages through a different collection route - say upstream of salaries.

    Or a PST - pension savings tax.


    I wouldn’t be very happy with the current plan being spun off to Alberta.
    Last edited by KC; 08-11-2019 at 02:04 PM.

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    Former Progressive Conservative MLA Doug Griffiths was on the committee and said none of the ideas hold up to scrutiny.

    “Pretty much all of it was non-starters, I realized that a lot of the rhetoric that comes with it comes from anger,” he said. “That is the first time that I learned that your anger is a liar.”

    The committee came at the start of Griffiths 13-year-run as an MLA. He said he had long thought the province was getting an unfair deal and should adopt all of the ideas, but close study showed they’re all flawed.

    An Alberta pension plan, for example, would struggle to match the 10 per cent rate of return the CAPP plan has seen Griffiths said. He said an Alberta plan would also be pushed to invest in provincial industries instead of creating a more diversified portfolio.

    “Then when you have a downturn in the economy, you have a downturn in your pension plan.”
    https://edmontonjournal.com/news/cal...box=1573660335
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