The federal Conservatives are relentless in their attack on workers and workers’ rights, on behalf of their corporate backers.
The latest attack is buried in a discussion paper from the federal Department of Finance with the innocuous-sounding title of “Pension Innovation for Canadians: The Target Benefit Plan”. In 21 pages that are likely to confuse any but the most dedicated pension wonk, the Harper Tories have hidden a stealth attack on workers and pensioners who have paid for and earned a decent pension over their working careers.
Beneath a lot of fancy language about principles like Pension Sustainability, Benefit Security, Transparency and Equity is a scheme that would allow employers to walk away from the contractual, legal and ethical obligations to pay for the defined benefit pensions of their current and former employees – even severely cutting pensions to those already retired.
The paper presents Target Benefit Plans as an innovation, despite the fact that Target Benefit Plans, in the form of union-sponsored multi-employer plans, have been an important source of retirement security for hundreds of thousands of Canadian workers over many decades.
In these multi-employer plans, members are offered a defined benefit, and employers trade off control of the pension plan (and any right to contribution holidays and funding surplus) in exchange for a fixed collectively-bargained contribution and a fixed financial liability.
The Conservative’s innovation would be to extend the target benefit concept to non-union and single-employer situations (in the federal private sector and crown corporations), allowing employers to limit their contributions and liability, while retaining plan control and potential access to surpluses.
Most egregious, the proposal would allow employers to reduce already-earned benefits, including pensions to members already retired. This is unprecedented. Currently, employers cannot shed their responsibility for already-earned benefits without going bankrupt.
This is the poisoned fruit buried in the mumbo-jumbo of this discussion paper. The IAM has told the Harper government to withdraw this unfair proposal, as have other unions, and the Canadian Labour Congress.
