Treat pensions as a right, not a privilege
When are political leaders going to begin treating
pensions as a worker’s right – with the protections that accords – and
not a privilege to be crafted for the fortunate few but not all?
That question crossed the minds of many interested
observers last week as Bill 120, the second leg of the provincial
government’s pension reform package, was debated in Second reading at
Queen’s Park.
While we welcome some aspects of Bill 120, there remain
gaps in the legislation that need immediate attention before these
reforms get passed into law.
Let’s start with something so fundamental that it’s
scandalous we should even find ourselves discussing it in the year 2010.
I’m referring to the fact that today fully two of every three Ontarians
have no workplace pension plan. Addressing this injustice must be the
departure point for any meaningful discussion on reforming other aspects
of our pension system.
But Bill 120 makes no mention of this. Instead it
dresses up reform in bells-and-whistle while hundreds of thousands of
hard-working people face the prospect of retiring on their own savings
and the limited amount paid out by the Canada Pension Plan because there
is no requirement that employers enroll their employees in a protected
plan.
There are other shortcomings in the Bill.
Under the proposals there is a perceptible shift from
legislative oversight of the pension system, to political oversight. For
the first time public sector plans will be guided by regulations, which
is the responsibility of cabinet, and not by elected members in the
Legislature as it rightfully should. This is a dangerous move that
diminishes public accountability and must be cut from the Bill.
The proposed legislation also ignores changes needed to
the pension benefit guarantee fund. The eligible amount has remained
fixed at $1,000 since 1980. Prof. Harry Arthurs, who reviewed Ontario’s
pension system for the government, recommended the amount be increased
to $2,500. But Bill 120 is silent on this issue despite the fact that
cost of living increases alone over 30 years have severely limited the
benefit guarantee.
Another of Prof. Arthurs’ recommendation has also been
ignored. He called for the establishment of an Ontario pension agency
with a mandate to fix those pension plans that are in trouble. When we
think of the pension crisis affecting retirees at Nortel, CanWest Global
and AbitibiBowater, we can see how desperately we need an agency
dedicated to protecting those whose plans are under siege.
Bill 120 is a step in the right direction, but the
government is missing a crucial opportunity to plug some obvious leaks
in the legislation. By choosing to ignore the shortcomings today we are
only delaying until tomorrow the inevitable need to fix – again – the
pension system.
Now is the time for to push the province on expanding
the CPP in a meaningful not (modest) way and to reiterate that defined
contribution option is no substitute.
Need we remind the government yet one more time that it
wasn’t working people that caused the problems currently affecting the
pension system? Let’s not re-victimize this group by failing to put
forward reforms that work on behalf of everyone in a fair and just
manner.
In Solidarity
Patty Rout
First Vice-President / Treasurer
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