B.C. funds counter CFIB attack on public sector pensions | National Union of Public and General Employees

B.C. funds counter CFIB attack on public sector pensions

Business lobby group's 'research' on pensions laced with misleading information and false claims

Victoria (21 Feb. 2007) - Catherine Swift, head of the Canadian Federation of Independent Business (CFIB), has once again been chastised for issuing a misleading and poorly-researched attack on public sector pensions.

This time the criticism comes from the board of trustees for three public sector pension plans administered by the Pension Corp. of British Columbia. They include B.C.'s College Pension Board of Trustees, the Public Service Pension Board of Trustees and the Teachers’ Pension Board of Trustees.

John W. Cook, chair of the board for each of the plans, says in a letter to Swift that the CFIB failed to take into account "public information that is readily available" on the issue and that it did not bother to contact "any Canadian public sector pension plan administrators" before releasing her broadside to the media.

Among the shortcomings of Swift's 'research', Cook cited the following:

  • The CFIB was wrong on the most basic premise of its attack when it claimed that taxpayers were on the hook for a widening gap between public and private sector pensions. In fact, for the three plans Cook oversees, employees contribute up to 50% of all costs.
  • Swift failed to deal with legitimate and legal differences between public and private sector pensions in her criticism, and falsely claimed that public sector pension plans are not required to have actuarial valuations performed.
  • Swift wrongly implied that Canadian laws and regulations discriminate against private sector employees when, in fact, both public and private sector employees can allocate 18% of their income to tax deferred retirement.

Cook also made a series of further detailed comments on the CFIB attack. They can be found at this Pension Corp. of B.C. web address. A related letter was sent by Cook to the Vancouver Sun.

"We find your research paper does not provide a positive contribution to the current public discussion on the issues affecting pension plan coverage in Canada," he wrote to Swift.

"From our perspective, a potential solution to the predicament you describe is for private sector employers to help their employees to prepare for retirement. Your members could significantly reduce the gap if they established pension plans that required employee and employer contributions and worked with their employees to provide a reasonable retirement income. The CFIB could establish a multi-employer pension plan as a base for small business owners to offer a pension plan to their employees. This could be done relatively simply and could become one of the more valuable reasons for small businesses to join the CFIB. There is great value to pooling risks that could not reasonably be undertaken by any one employer."

The critique is similar in key areas to arguments made in an earlier letter to Swift and the CFIB from Larry Brown, national secretary-treasurer of the National Union of Public and General Employees.

Brown, who called Swift's broadside economically illiterate, also cited the erroneous assertion by Swift that taxpayers and employers pay the full cost of public sector pensions. He also argued that the CFIB should be exercising greater responsibility in the corporate sector by urging private employers to build pensions up, and thus reduce potential future liability by the government, rather than tear public pensions down. NUPGE

More information:
Larry Brown on CFIB's 'economically illiterate' attack
CLC: CFIB's thinking is upside down
 

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