The race to the bottom

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We should be improving pensions, not dragging them down

There has been no shortage of negative opinions over the past several months on public sector pension plans.

No doubt about it, an attack on defined benefit pension plans in general, and public sector pension plans in particular, is occurring in this country and has reached our province.

Whether it’s the Harper government, the Fraser Institute, the Canadian Federation of Independent Business, labour lawyer Howard Levitt or Richard Alexander of

the Newfoundland and Labrador Employers’ Council, the attack on the people who serve their fellow Canadians is the same.

Attacking the ‘gold-plated’ pension

If you’ve paid any attention to their media messaging over the last little while, you’ve heard the mean-

spirited arguments such as “taxpayers” (many of whom do not have the pensions and benefits of public sector workers) cannot be expected to foot the bill for the “gold-plated” pension plans of public sector workers.

They go on to argue that it is intolerable and nonsensical that public sector employees who are paid by “our tax dollars” are making more than the private citizen and enjoy better pensions and benefits.

It is a cynical attempt to objectify and demonize public employees.

Ironically, organizations like the Fraser Institute have very generous compensation packages for their executives.

Since they have tax deductible, charitable status, it is the taxpayers who are on the hook. Yet it doesn’t seem to prevent them from claiming the “taxpayers” of Canada cannot afford to pay decent pensions to public sector employees.

Not tax-exempt

However, public sector workers are taxpayers too.

Many right-wing thinkers seem to forget that.

Public sector employees and public sector pensioners contribute their fair share of taxes to society. They are not a group separate from Canadians.

It is unfair and reprehensible to characterize people who have dedicated their lives to the public good, who carry out the work of government, and who serve and protect the citizens of this country as simply a drain on the public purse.

Probably the most unsettling aspect in the strange world view of the right wing is the belief that equality and fairness are achieved by cutting or reducing benefits.

Private sector workers have defined contribution plans and many Canadians taxpayers, they will tell you, do not have any pension plan.

Therefore, they argue, neither should public sector workers.

Taking away benefits

Their solution to creating a level and more equitable society is to strip away the rights and benefits of public sector employees until they are reduced to the level of private sector workers.

How is this fair?

Shouldn’t fairness be the other way around?

The idea of fairness promoted by right-wing interest groups involves tearing down negotiated and hard won benefits, rather than raising the benefits of those without. I guess without the public sector to aspire to, the private sector will have no incentive to make sure their employees receive fair remuneration, benefits and working conditions.

A different approach

If fairness is the rationale, would it not be more reasonable to increase the benefits of private sector workers so that they can enjoy a reasonable standard of living?

Would it not be more just to establish defined benefit plans for private sector workers so they can retire with some sense of dignity, respect and security?

These are, after all, the people, whose knowledge, skills and commitment are largely responsible for the profits and success of a business.

Shouldn’t fairness dictate that private sector employees be accorded the same respect as their public sector counterparts?

Yet, most businesses do not offer a workplace pension plan while others are getting rid of their current plans.

Instead, they propose individual retirement plans offered by the financial services industry.

The crash of 2008 demonstrated how insecure these were.

Improving the Canada Pension Plan would be a better alternative, but this is rejected by the Harper government and right-wing interest groups.

It’s easy to talk fairness, but it takes more than rhetoric to make it work.

Let’s be clear, defined contribution plans place all the risk on the employee, the person who can ill afford to take it on.

Many people work at minimum wage jobs, sometimes two, to make up a full salary so they can afford a place to live, food to eat and clothing for themselves and their children.

Opposing wage improvements, too

Yet it is the employers’ councils across this country who oppose even a modest increase in the minimum wage, since it will affect their bottom line and make their products unaffordable for the average Canadian.

Well, many things such as food and housing are already unaffordable for the average Canadian.

Retirement, for many, is unaffordable.

Reducing the benefits of one group will not make retirement affordable for another.

Defined benefit plans, on the other hand, offer the fairest and best protection to employees (private or public) who have served their employers faithfully throughout their careers.

From our own research and reading, we know defined benefit plans can be viable.

Most employees enrolled in such a plan understand that action has to be taken to make it sustainable and stable.

That’s why the NLTA is constructively engaging in the provincial government’s consultation process.

That’s why, over the years, teachers have made concessions and sacrificed benefits to secure stability in the pension plan.

In the end, a resolution will be reached and a contract presented to our teachers to be voted upon in a fair and democratic process.

The contract will be signed and both sides will live with the results.

Businesspeople, at least, should understand a contract.

Discuss, don’t dictate

Rather than dictating what must be done, employers’ councils, federations of independent businesses and the Harper government should engage in a constructive and democratic process to ensure all Canadians are able to enjoy a comfortable and secure retirement.

This is fairness.

This is just.

These are principles integral to all Canadian society.

James Dinn is president of the

Newfoundland and Labrador

Teachers’ Association.

Organizations: Fraser Institute, Canadian Federation of Independent Business, Newfoundland and Labrador Employers Newfoundland and Labrador Teachers

Geographic location: Canada

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