Susan Eng, CARP VP of Advocacy headed to Parliament Hill on April 21, 2009 for an appearance before the House of Commons Standing Committee on Finance. We took the opportunity to highlight the need for immediate action to repair Canada’s pension system and bold leadership. “The fallout from the current economic crisis is especially hard on retirees and demonstrates that the current pension system fails to adequately provide for our retirement security. And not only are those with RRSPs and employer sponsored pension plans watching their retirement dreams evaporate, nearly 30% of Canadian families don’t even have any retirement savings.,” said Susan Eng, Vice President, Advocacy of CARP.
CARP pointedly called for a Pension Summit of the First Ministers and Finance Ministers to initiate and coordinate pension reform measures to protect the retirement security of all Canadians and ensure the material participation of knowledgeable representatives of plan members and retirees. “Until recently, pension reform has been the quiet preserve of pension experts, often to the exclusion of those most affected and least able to influence the management of their pension savings. This must change, not only because it is inequitable but also because today’s retiree will no longer accept the status quo. Millions of Canadians are looking to all levels of government for bold leadership to ensure that protection of their retirement security remain the top public policy priority,” added Eng.
Employer representatives in attendance seemed to have other ideas on how the Canadian pension system should respond to the current crisis. Mr. Brian Aitken, Chief Financial Officer of Nav Canada, said the solvency deficit funding amortization period should be extended from five years to ten “without conditions such as member consent or letters of credit.”
When asked by Ted Menzies, the Parliementary Secretary to the Finance Minister whether member consent was too onerous a requirement for a sponsor, Siim Vanaselja, Executive VP and CEO of BCE and Bell Canada responded “if you bring employees into it… it would be very impractical on an issue like pension, which is so complex. The education alone would be very difficult challenge [sic] for us.”
Luckily, Ms. Eng was at the table to speak on behalf of pensioners “You’ve heard today the kinds of things that have historically brought us to this point; for example, employer representatives saying we have to change the rules without asking for the consent or involvement of the pension plan members because it would be too difficult, they would have to learn too much. Let’s start teaching them! At this point, people are very much aware of the issues. It’s not that difficult. Although pension experts say this is a mystical area, it’s really simple arithmetic: if you take out money when times are good, you’re going to face problems when times are bad. It’s that simple, and that’s what has been happening.” She said in response to Mr. Aitken and Mr. Vanaselja’s comments. To view a copy of the Committee transcripts please click here.