OPSEU submission to the Expert Commission on Pensions

'Pension assets represent deferred wages and should be deployed in the interests of active and retired members.'


Toronto (1 Nov. 2007) - The Ontario Public Service Employees Union (OPSEU/NUPGE) has submitted a detailed brief to the Expert Commission on Pensions – chaired by labour law expert Harry Arthurs.

"The fundamental belief and official policy of our union is that our members' pension assets represent deferred wages and should be deployed in the interests of active and retired members," OPSEU says in its submission.

"This includes contributions by workers, by employers on their behalf, and any and all investment income generated by those contributions."

OPSEU argues that "the pension promise" goes beyond "a formulaic target" for employees when their careers are finished. "It represents for thousands the promise of security in retirement."

The union also makes a "fundamental distinction" between "the alleged pension funding crisis and the crisis in retirement security."

"The latter goes far beyond the ability to meet promised obligations to a broader debate about public pensions like the Canada Pension Plan (CPP), complementary social programs for the elderly, the state of public services in general and the impact of growing income disparities on basic necessities like housing," it argues.

"It has been our experience, and that of the broader labour movement, that the development of Canada's defined benefit (DB) pension plan system flows from the collective bargaining relationship between employers and workers. Unionization and pension plan coverage are inextricably linked and participation rates correspond to union density," OPSEU adds.

"In many ways, the solutions to our retirement challenges are to be found at bargaining tables. At a broader social level, our union and the Ontario Federation of Labour and its affiliates play a critical role in promoting general retirement security for all citizens."

OPSEU makes the following recommendations to the commission:

  • Provide public education regarding the long-term impact of management fees, advertising costs, and administrative instability associated with non-DB retirement plans.
  • Redraft the Pensions Benefits Act and empower Financial Services Commission of Ontario (FSCO) to ensure minimum and best practice standards are understood and respected.
  • Recognize joint trusteeship between employer and employees as the best long-term method to protect DB pension plans.
  • Surpluses generated by plans should be used for the benefit of active and retired members.
  • Lobby the federal government to lift the 10% rule for public sector pension plans or all pension plans.
  • Respect the "pension promise" by requiring or facilitating full indexation of benefit entitlements. In any case, plans should be required to have a written funding policy with inflation protection as the highest priority.
  • Expand coverage of DB plans by removing any legislative or regulatory impediments faced by existing pension plans to the expansion of coverage for new employers and workers. NUPGE

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