I can start if you like. I'm from the Department of National Defence and we get a fair number of these kinds of questions.
People face the biggest drop in overall pension income when they take their CPP benefits early. That's only been permissible since 1999, so I think that's why we're seeing this issue be a problem for people.
Not everybody is a financial whiz. Not everybody understands or is counselled appropriately on the ramifications of the decisions they make. The Department of National Defence has some obligation, in the sense that they provide financial planning through the work of SISIP, the agency that does this for the department for members and veterans. But individuals need to take responsibility for themselves and be educated about it. The question is, what has the department done in that timeframe to help educate people so that it doesn't come as a really horrible shock when they turn 65 and all of a sudden they're without a sizeable chunk of the income they've been counting on?
First of all, while you're still a member of the forces, there is a chain of command that exists. You can always ask your superior officers to find answers to questions you have about your pension plan if they arise in that time. But as I think we talked about the last time, these questions don't tend to arise until a couple of years before you're getting ready to retire. When you're 18 and interested in the new things you can do and the new places you can go with the forces, you are not thinking about your pension plan, yet your pension plan begins at that time. So the Government of Canada is responsible, in that even though the average person isn't thinking about their pension plan, a pension plan begins to be provided.
During the development of the reserve force pension plan, a great deal of communication was done to find out what people wanted in the pension plan. We gave them the ability to communicate their questions directly to the project team as the pension plan was being developed. The bridge benefit was a topic of conversation then as well. That information continued to be provided through a number of forums, such as newsletters, articles in The Maple Leaf, and information notices.
There's a formal mechanism as well. It's called the Canadian Forces Pension Advisory Committee. It's set by legislation, and it has been in existence pretty much as long as the CFSA has been in existence. On that committee are senior members from each of the environments, a member from the reserves, and some folks from the pension world. Their job on that committee is to advise the minister about pension issues and discuss things like the bridge benefit and its impact on members. So that has been in effect for a while, and it continues to be in effect. We can continue to use it as a means of wrestling with pension issues and their impact on members and pensioners.
If you're a CF member or a pensioner and have questions about your pension and why the bridge benefit has hit you, there is a 1-800 line that has been in operation for quite some time. Folks can call up and get information specific to them. The people at the end of that line have access to CF members' service records as they pertain to their pensions, so they can answer those kinds of questions.
I mentioned the last time that we have a new website. I've looked at the transcript of that meeting and want to clarify something. There are 300 pages of text on the website; it's not a hard copy manual at this point. We've had a pension manual for quite a while, but with the new reserve force plan and the changes made to the pension plan, the manual is outdated. So rather than go with a hard copy first, we went with a website because people are very attuned now to getting information off the web. It's also much easier to maintain. If any changes happen, bing bang, we get the IT guys on the case to update the website.
In the process of doing the website we took the opportunity to look at all of the communication products the department uses to communicate information to pensioners and to members. All of the information was looked at, not only for accuracy in light of the changes of the new plan, but for readability and relevance. How readable and relevant is it to the person who's reading it? Let's face it, pensions are a difficult, complex subject, and you don't get a nice, warm, fuzzy feeling until someone says to you, “For you, this is what's going to happen.” So the website is trying to answer that question.
It's not a substitute for a one-on-one briefing, but a one-on-one briefing is beyond the resources of the department. It's not a bad substitute. When you go to the website you pick out the kind of person you are. So if you have been in the regular force since before March 1, 2007, you click on that link and all the information related to it is related to people like you. It specifically will give you all the information, with the exception of just what your pension will be. It won't give you that information yet, because we don't have the systems to do that, but if you call the 1-800 number knowing what's available on the website, you'll be much more knowledgeable and able to make decisions about things such as whether you should buy back, how you prepare for the bridge benefit drop-off, and whether you should take the CPP at 60 or 65, and you'll have a much better idea about the impact of those things on you personally.
Lastly I would say that when you're getting ready to retire from the forces, they have SCAN seminars. The acronym escapes me at the moment, but it stands for second career something, and in that people are told about the bridge benefit, that it's going to happen to them. But let's face it, I think the average retirement age is 43 in the Canadian Forces. So 65 is a long way away. So it's not very likely that you will continue to remember that, but to help you remember, every year with your pension stub--once a year--you get a letter, and in the letter there is a reminder that the bridge benefit will cease at the age of 65. So every year you'll be reminded that that's the case. That's what we have available.
