Did we just get Pension Reform and No One Noticed?

Just when we thought we’d have to remind the politicians that we were prepared to change our vote to support our demands for urgent pension reform, federal Finance Minister Jim Flaherty and Ontario Finance Minister Dwight Duncan exchanged letters setting out their vision of pension reform on the eve of their meeting in PEI.

Clearly they had discussed it between themselves since the letters were nearly identical but they caught the other Finance Ministers off guard, especially Alberta’s Ted Morton, who was already staking out outlier territory on pension reform, and was quoted fuming that he would have appreciated more notice.

Perhaps he might have briefed himself on his predecessor, Iris Evans’ promise to “go it alone” to set up a supplementary plan if her colleagues were not ready to act nationally.

Or maybe read the submissions and recommendations from the 2008 BC-Alberta Joint Expert Pension Panel which lead BC Premier Gordon Campbell to get a Bill passed as a pre-election initiative to set up a voluntary supplementary pension plan. That ABC Plan appears to be in limbo with no action since the election.

Last May, the Finance Ministers established a Research Working Group to study the various proposals for reform. CARP and others pressing for reform were worried that this was a delay tactic. The political rhetoric was essentially that the fears about under saving and retirement insecurity were over blown. This was backed up by the engagement of a economist known for his views supporting that position.

So CARP made a point of meeting with provincial finance ministers – starting in Newfoundland, then Nova Scotia and earlier this year in Manitoba – where we found much more receptivity – possibly because people in those provinces in particular faced more economic challenges and financial insecurity came more readily to mind.

Indeed, Newfoundland’s then Finance Minister, Jerome Kennedy, committed to giving CARP’s proposal for a Universal Pension Plan to his counterparts on the Research Working Group – which was directly responsible for CARP’s UPP being included as one of the major options under consideration.

By the time we met with BC Finance Minister Colin Hansen this Spring, he had already led the charge to issue a minority report to the disappointing declarations coming out of their Whitehorse meeting in December. Apparently telling Canadians that our retirement system was just fine was thought necessary in a fragile economy. Minister Hansen was reminded of that when he was obliged to retract his call to action, that a pension crisis was looming unless governments acted. When I quizzed him about it, he said the situation needed public attention but it was not a “crisis”.

So obviously, there were low expectations as the ministers made their way to PEI. The CARP poll taken that day showed that our members certainly did not have much optimism. Then almost as soon as we sent out the poll, the exchange of letters was released without much advance notice.

Was this a breakthrough or a mirage? Hard to tell without the fanfare!