Inching toward pension fairness

Two examples of your tax dollars at work this week paint an interesting picture of government thrift and largesse.

First, the bad news.

A report by the Fraser Institute (no surprise) shows government workers in British Columbia enjoy higher wages and more generous benefits than private-sector employees.

Using Statistics Canada data, the study calculates that government workers in B.C., including federal, provincial and local governments, receive on average 6.7 per cent higher wages than comparable workers in the private sector.

Also, 86.9 per cent of government workers were covered by a registered pension plan, compared to only 19.2 per cent in the private sector. Of those covered, 95.7 per cent of government workers enjoyed defined-benefit pensions, compared to 46.9 per cent of private-sector workers. Absenteeism is also a problem – government workers are absent an average of 12.7 days a year, compared to 9.3 for everyone else.

There's no reason – or evidence – to show government workers are worth more than anyone else, work harder or are smarter. The reason they're so much better off is big labour and its costly contract demands. Few other organizations have the power to bring the operations of the entire province to a screeching halt, so the threat of a strike is a heavy burden.

But it's not all bad news.

On the federal front, MPs' much-maligned gold-plated pension plan will begin being phased out in favour of what Okanagan-Coquihalla MP Dan Albas calls something "more respectful to taxpayers."

Following the coming federal election, MPs elected to the next Parliament will see pension contributions move to 50/50 cost sharing rather than the fully taxpayer-funded plan they now enjoy. MPs will also see the age at which they can collect their pension climb from 55 to 65. 

The changes will only affect newly elected MPs, not those already in the system – but it's a start. Over time, they'll all end up on the new plan. Meanwhile, regular Canadians recently had their age of pension eligibility upped to 67.

Still, it's a step in the right direction toward fairness for Canadian taxpayers. The changes are estimated to save taxpayers $2.6 billion over the next five years.

Now, that's worth cheering.

— News Director Jon Manchester



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