KINDERSLEY, Sask. – Away from the maddening crowds, a multi-million dollar financial organization in this western Saskatchewan town has survived the vagaries of politics and stock markets.
The Saskatchewan Pension Plan is unique in North America, says general manager Kathy Strutt, from her office in the blue building on Main Street.
Now in its 12th year the plan, set up to serve homemakers, part-time workers and other low income people, has 30,000 members and $156 million in assets. About 37 percent of the members are Saskatchewan women who live in rural areas and towns with fewer than 5,000 people.
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This plan was the brainchild of the Grant Devine government, and does not require the members to earn income to make their own contributions. They can put in a maximum of $600 a year and, depending on their lack of income, have the province kick in as much as $300 a year to match.
“I thought it was an excellent idea,” said Carol Lees, a Saskatoon home manager who has campaigned for a decade for the rights of women who are not paid for their work. She said she liked that home managers could contribute in their own name for themselves. She said it’s demeaning that other plans require that someone makes the contribution for a home manager because under federal rules people must earn income to save for a pension plan.
But now the plan has been “stripped of its guts” said Lees.
“Now it’s just an RRSP.”
A cash-conscious NDP government tried to kill the plan first, then removed the matching grant portion, the guarantee of a minimum pension, plus the plan’s operating budget. In a six month period after the changes, the plan’s membership dropped to 55 percent of those who originally joined.
In 1990, the plan’s office was moved from Regina to Kindersley, 390 kilometres away, as part of the Devine government’s plan to relocate government jobs from the city to rural areas. Of the 16 staff, only two opted to move so 14 were hired locally and had to be trained in November just as the office was heading into the busy New Year period.
The new staff bonded well, said Strutt because they realized the plan would now rest on their administrative ability.
The present 12 staff members have varied backgrounds and education. Strutt has a bachelor of commerce degree and worked in banking and for the town of Kindersley before joining the plan’s staff seven years ago.
Inside the roomy office, the staff are on the phone steadily this month as 60 percent of the annual contributions come in during January and February. About 10 percent of the business walks in the door but Strutt said most inquiries come by mail or telephone.
Strutt said plan members often ask for advice, especially about what route to take their pension monies.
“We aren’t going to counsel them. We just offer them choices,” she said adding there are accountants and financial planners to handle the advisory role.
While all Canadians aged 18 to 69 can contribute under the Saskatchewan Pension Plan, few do. Those from outside the province tend to be the elderly who have moved away or students.
Strutt said she’s not sure why other provinces haven’t set up similar plans, but suggests the expense probably stops them. However Alberta and British Columbia have talked about similar concepts.
“Right now our highest pension is $115 a month. … I don’t think you could live on what SPP can pay,” said Strutt, adding the Saskatchewan pension is more a supplement to other savings.
The plan is managed by a board of five people. The money is invested by two companies, one in Regina and another in Vancouver and invests conservatively in blue-chip companies, bonds and some foreign stocks. No Bre-X stocks or other high risk mining companies.
Returns have averaged 10.85 percent over the life of the plan. Last year it made 18 percent but Strutt doesn’t think it will be as high in 1998 with interest rates down and the stock market declining. Over its life, the plan’s yearly earnings have ranged from a high of 21 percent to a low of 6.3.
Two months ago the plan got its own site on the internet at www.gov.sk.ca/spp but it can also be reached on its toll-free line at 1-800-667-7153. (Those with hearing loss should call 1-888-213-1311.)
