This is your daily pension announcement! The other shoe has dropped edition. The ATA put out this release today. Loyal Tweeps, you know that the ATRF and AIMCO have been negotiating an Investment Management Agreement (IMA) for the last year. #ABLeg #AIMCO…
Apparently, negotiations have failed and Travis has imposed an IMA by Ministerial Order on Dec 23.

Merry F***ing Christmas! @schill_dawg essentially calls Kevin a bitch! Read it and see. #ABLeg #AIMCOfail #Christmascameearly
You wouldn't know that it had become law as it isn't listed with all the other Ministerial Orders on the QP website. I didn't think that was legal, to sign an MO and then keep it hidden from people like me. But, oh well. Nobody has ever accused Travis of being a genius. #ABLeg
The ATA has provided all of us with a scan of the MO, thank God. (See link in the release.) Otherwise we wouldn't know what the law in Alberta was. #AbLeg
Remember this isn't a level playing field. The GOA is the sole owner of AIMCO and Travis is a Minister of the Crown. He is imposing an agreement on ATRF that is jointly run by GOA and teachers. ATRF is the trustee of the assets. Travis is conflicted. #ABLeg
I will take a couple of days to unpack the contents of this order. So far it is the embodiment of the good, the bad, and the really ugly.

The Good: the IMA includes a recognition that the ATRF board will establish the investment policy to direct how plan assets are managed.
The Bad: Page 16 AIMCO costs "such costs should be lower than the market standard fees charged by comparable for-profit providers of investment management services to their clients" #ABLeg #thatsnotwhatyousaidbefore
Really? Travis' one line through this whole debacle is this would save money by in-sourcing from for-profit advisors. Now all AIMCO has to do on costs is less than the private sector? How about 30% less than the private sector? Or how about at a cost less than ATRF currently?
This provision is in direct opposition to what Travis said. #AbLeg AIMCO costs have gone up every year of its exsistence.
The Fugly: AIMCO has some veto power over ATRF investment decisions. To quote: “Specifically, AIMCo is not required to implement ATRF’s Investment Policy if, in the sole opinion of AIMCo, it would threaten to compromise AIMCo’s economies of scale or operational efficiencies,”
Ask @premiamanagement what he thinks of that clause. No appeal. As a former Board Member, I would tell you that ATRF would never voluntarily enter into a management agreement with this clause. #ABLeg
I suspect because of the role that million-dollar bonuses played in the whole VOLTS debacle, AIMCO is directed to consult with its clients on its compensation system (section 8.5). #ABLeg
This is important because, in this business, more than any other, compensation drives behavior and risk-taking. A bad compensation system will drive bad behavior. #AbLeg
Pension benefits do not change. Contributions do not change. But joint governance (since 1938) takes a real hit. #ABLeg
I tried to tell Kevin (back in the day) that he really didn't want 80,000 clients that hate him. But he didn't listen. #ABLeg

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More from @yomeeks

1 Jan
This is your daily pension announcement: Please remember YYC, the average LAPP pension paid is $18,000. Even at that amount the AstroTurf organizations with secret donors seem concerned. #handsoffmypension #ABLeg
The numbers are in! The pandemic has been good to some people...

To the end of 2020 North American billionaires (661 of them) have profits totaling $1 trillion dollars from the beginning of the pandemic. That is a cool trillion baby! #handsoffmypension #ABLeg
Which again makes me wonder about the abject stupidity of changing Alberta from the lowest corp tax province to the ultra-lowest corp tax province. Corporations pocketed the profit, made some Cayman Island deposits and Bob's your uncle. #ABLeg #Travisfail
Read 4 tweets
30 Dec 20
This is your daily pension announcement: What should the Board of AIMCO look like? For an answer to this question look no further than the report prepared by Bill Moreneau when some tiny pension plans were being amalgamated in ON. #ABLeg
Travis didn't realize he needed a report here before messing with public sector pension plans. He claimed public knowledge of his plans would be "damaging". Why can they do it in ON then? #ABLeg #idiot
To transfer Bill Moreneau's well researched recommendations to AB we would have an AIMCO Board with 11 directors: 6 (including the chair) would be appointed by the GOA, 3 by the clients (LAPP, ATRF etc) and an additional 2 by the plan members (you and me). #ABLeg
Read 5 tweets
29 Dec 20
This is your daily pension announcement: The Pension War Room would like to thank the entire pension army as we get ready to welcome the new year! 🙏🙏🙏🙏🙏

Of course, I am still marinating in a loathsome broth, stuck on poor public policy and accountability. #ABLeg
On that note, I will again take a dip in the stinking, fetid cesspool of Alberta's public finance in the hopes of educating and inspiring. #ABLeg #travisfail

To quote a pension manager:
"In operation however, AIMCo has issues with alignment and dis-economies of scale... "
"As AIMCo has non-pension fund clients, its strategy is aligned more closely with an investment fund (focusing on returns) as opposed to a pension fund manager (focusing on the liabilities)."

VOLTS is one example of a strategy that is not appropriate for pensions. #ABLeg #fail
Read 7 tweets
28 Dec 20
This is your daily pension announcement!

#JasonKenneyTaughtMe to fetishize Fraser Institute reports, no matter how ludicrous they are.

Remember when he was on TV saying the GOA guaranteed your pension? I sure do. #ABLeg #hegotthatfromthefraserinstitute
BTW, public sector pensions are guaranteed by the assets in the bank not by any promises from the @jkenney. (If you doubt this please read the Teachers' Pension Plan Act.)

I think he also said that it was GOA's sole right to appoint an investment manger for ATRF. Wrong. #ABLeg
I wonder how life is for Kevin now. When he looks at himself in the mirror does he wonder why so many plan members hate him? He and Travis together have killed development of a robust institutional investment community with competing, high performing public sector plans. #ABLeg
Read 6 tweets
22 Dec 20
This is your daily pension announcement! AIMCO is looking for a new Board Member! I am hoping they get someone who can ask the question: "Which one of our current investment strategies is NOT covered by our risk system?"
#ABLeg #funnynotfunny…
But seriously, the person has probably already been chosen. Probably an associate of Mark Wiseman and Bob Kelly as they seek to consolidate some power on the Board. #ABLeg
Please note that AIMCO can (and I believe does) hold Board meetings in Toronto. Since most of the directors live there.

Remember that next time Athana and Travis talks about bringing assets "home" to Alberta. #ABLeg
Read 8 tweets
22 Dec 20
This is your second daily pension announcement! Remember when Travis said that AIMCO will save beaucoup dollars due to economies of scale? I sure do.
The AIMCO "business case" claims costs will come in below 50 bps when ATRF is subsumed. #ABLeg #bullshit #travissucks
For comparison we should use CPPIB which is roughly 4 times larger than AIMCO ($410 bil vs $103 bil). Being larger with roughly the same investment operation it should have lower costs.....

...but it doesn't. Costs for CPPIB right around 90 bps. #ABLeg
That's right. Cost is roughly double. So much for economies of scale.

(This was predicted by academic research that shows dis-economies of scale kick in above $100 billion. Thank Bill Morneau for the research.)
Read 9 tweets

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