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January 26th, 2010:

PS pensions and Doris Day

PS pensions. What will Day want to do?

There is much angst at the moment among Public Servants with regard to what the future holds for their jobs, salaries and pensions. And I think that this concern has some merit given the track record of the new Treasury Board President as a spender rather than a cutter in his old job as the Alberta Treasurer. He may want to prove to his right-wing supporters that he is not afraid to take the axe to spending.

This is what he said during Saturday’s CBC interview:

Q Will public service pension schemes need to be addressed?

A We will look at everything. I am looking for an overall co-operative approach and you will see the details begin to unfold.

I take this to mean that pensions are indeed on the table as well as PS wage controls beyond 2011. Salary increases of 1.5% in each of the three years of the current collective agreement will expire on June 15 th, 2011.

So let’s put aside wages for a moment with the acknowledgement that – given the history of either the Grits or the ReformCons (doesn’t really matter who’s in power, in this case) – any medium term restraint plan will once again include impose salary increase limits.

So – to pensions.

When I signed on to this job about 13 years ago, it was with the knowledge that I would be paid at a lower rate than I would have been – all else being equal – in a similar position in the private sector. I was willing to accept this because the PS pension benefits are really a part of my salary – a deferred salary. I do pay one-third of the total contribution to my pension benefits and the government pitches in the rest. Should that ration change? Maybe. But slowly and it should certainly not be without extensive discussions with the PS Unions. This is what I signed on for and the pension is what was promised to me… and I expect the government of the day to live up to their promise.

But – you say – the private sector employees are being robbed of their pension benefits by their former employers, why should the PS suffer the same pain? This is the argument of many right-wing think-tanks and analysts but is one that is from a profit-driven perspective. Any change to the rules that benefits the bottom line is a good move according to the CFIB, C.D. Howe Institute or the National Citizen’s Coalition (the group that Stevo used to lead).

But why do we have to dumb down the public sector to the level of the private sector? What can’t the private sector pension rules be every bit as generous those in the public sector? THAT is what the employees of big business should be asking their employers.

But what if the rules were changed, not retroactively, but only for new recruits?

Then that is a different case. The new employees are coming on board knowing at the time of their acceptance of the position their own pension provisions, rates of pay, etc. In much the same way that we in the PS know that if we do want to climb the corporate ladder, we will need to achieve some degree of competence in French (if an Anglo) and English (if a Francophone). The rules of the game are up front for all to see.

Yes, imposing less “generous” pension rules of the game would create two distinct classes of PS employees – one under the old provisions and one under the new and more restrictive provisions. This, in the long-run wouldn’t be a good thing. But it may be necessary.

So to sum up:

  1. I am assuming a pension – based more or less on the rules of the road when I signed on – to be there when I choose to retire (which BTW won’t be until I’m at least 61).
  2. I am willing to make a larger contribution (I currently contribute about $7,000 per year) of my deferred salary to the fund to ensure that it is adequately funded and to take a little pressure of the public purse…. as long as the changes are made progressively and with the cooperation of the labour groups.
  3. WRT to the above – the politicans MUST apply these changes to their own pension plans as well.
  4. I am NOT willing to accept large cuts to my benefits nor to changes to the years of service or ages at which one can claim a pension (even though I personally cannot benefit from early retirement).
  5. I am willing to accept that new Public Servants may have to have a plan that is quite different from my own
  6. And I strongly suggest that the private sector and all of those chattering, right-wing business interest groups look at something other than RoI once in a while and invest in long-term commitments to their most valuable resopurces – their people.

One final note. I know that very, very few outside of the National Capital Region give two shakes about the Public Service. Mnay native Ottawans don’t realise this having grown up in a Government town. But as an “import”, I can say with a high degree of confidence that tTo the bulk of the populace, we are painted with the same brush as the politicians and would not shed a tear upon hearing of cuts to the PS pension plan. The Harperites know this and may well be willing to enact radical changes knowing that while they may lose a few seats in the NCR, the impact would be neutral or even positive elsewhere.

And THAT is waht frightens me.