Profits important, but so are pensions
Re: “Guaranteed retirement income should be for everyone or no one; Shortfalls in public-sector pensions are coming out of taxpayers’ pockets,” by Mark Sutcliffe, Opinion, Jan. 24.
Sutcliffe misses some salient points that need consideration when discussing the differences between the defined-benefits pension system for federal employees and defined-contribution plans we’re seeing in the private sector.
First, he minimizes the fact that a significant amount of money is deducted from federal employees’ paycheques to support their pension plan, and though the government makes a contribution, it is not a free ride for employees. Would he prefer that retired employees just go on welfare?
Why is it unreasonable to expect any employer to match an employee’s pension contributions?
Sutcliffe also forgets that under Jean Chrétien and Paul Martin, more than $30 billion contributed by federal employees to this pension fund was raided and put into general government revenues to balance the budget at that time.
The government is facing a lawsuit on behalf of public servants to recover this stolen money. The public service pension deficit we see today is the direct result of this theft.
Second, Sutcliffe attacks federal employee pensions by saying, “Across the private sector, and even in government agencies like Export Development Canada, where defined-benefit plans existed, they are being phased out in favour of defined-contribution pensions. That’s the fundamental switch the government needs to take.”
I disagree. The average federal pension sits at about $30,000 a year — hardly a gold-plated payout.
That said, given the frequent abhorrent treatment of employees by the private sector when it comes to pensions, I fail to see his point. One only has to look at the thousands of Nortel employees who, when that company tanked, lost significant portions, if not all of their pensions, thanks in part to defined-contribution plans, while executives walked away with millions in bonuses and payouts.
Are these pensioners being wellserved by the private-sector system that Sutcliffe wishes to foist upon our entire society?
Third, I ask why is there so much animosity toward those who have managed to work hard finding careers both inside and outside of government with decent livable wages and benefits? Why do pundits insist we all race to the bottom to wallow in poverty when we retire with risky market-driven, defined-contribution plans so that we can increase profits for corporations on the backs of workers?
Why shouldn’t employers be required to ensure viable pensions are in place for employees? Are we willing to allow society to deteriorate to the point where people can’t retire unless they are filthy rich?
I believe our frame of reference has to change. The mantra that “this is how the private sector does things, so we all should” has to be reconsidered. The private sector is there to make profits.
Sutcliffe and his ilk need to start demanding that the private sector offer decent pensions to the employees who make these companies successful, instead of asking workers to give a lifetime to an employer only to be left with nothing or little to show for it when they retire.
If we want to live in a fair society, we need to start thinking harder about how we share the wealth. I do not believe that having our senior population living in poverty because of insufficient pensions is good for us, and I believe the private sector has some social responsibility to ensure it co-contributes to livable pension plans.
Profits for companies are absolutely important, but people are even more important.
Companies may be able to maximize their short-term profits for CEOS and shareholders with marketdriven, defined-contribution pension plans, but they leave behind a financial wasteland.
Society at large will feel the longterm pain of having our seniors living in poverty. Is that good for us? Is that good for Canada? Is that what we really want?