The Canadian Taxpayers’ Federation (CTF) says it wants to see reform in the public sector’s pension plans as part of a bigger list of reforms.
The CTF has put out a “wish list” of 15 proposals they want to see endorsed by parties in the 2015 federal election. The items on the list were selected out of 5,000 surveyed responses from their followers.
One of the most significant items was to see changes in the way every federal employee acquires their pension.
Aaron Wudrick, federal director of the CTF, said that the public sector pension plan is overly generous since taxpayers are paying the bills.
The defined benefit plan is a pension plan that federal employees may choose, which gives a guaranteed sum when the employee is retired.
“The problem is, if the investment doesn’t make as much money as it was supposed to, the taxpayers are on the hook for the difference,” said Wudrick.
This is why most of the private sector has moved towards defined contribution — a different type of plan — which works by having an amount from each paycheque set aside for investment, explains Wudrick.
The CTF’s wish list also includes other pension-related suggestions, such as Bill C-518. But it failed to pass in the Senate in July.
The failed bill establishes that politicians would lose out on government-funded portions of their pension plans if they are convicted of an offence relating to their job. The NDP as well as Tony Clement, President of the Treasury Board, previously had shown support for Bill C-518.
Wudrick also pointed out that the pensions of outgoing MPs are also going to be partially paid by taxpayers.
Any MP that is 55 years of age and has served six years or more can collect their pension. As well, they are entitled to a severance allowance equal to 50 per cent of the total of their basic annual sessional indemnity.
In British Columbia, nine MPs will not be seeking re-election, which will cost taxpayers $800,000 in severance this year.
The CTF list also contains items such as a proposal to hold a referendum on abolishing the senate, expanding the First Nations Financial Transparency Act and posting MP and Senate expenses online.
Below is a list of the retiring B.C. MPs and their severances provided by the CTF: