Ontarians could face billions in unfunded pension liabilities

SLM

The Velvet Hammer
Mar 5, 2011
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London, Ontario
Ontarians could face billions in unfunded pension liabilities
By Antonella Artuso, Queen’s Park Bureau Chief

TORONTO — Ontario taxpayers are being kept in the dark about potentially billions of dollars in unfunded public pension liabilities, Tory MPP Julia Munro says.
“Adding to our financial pressures are public sector pensions that we have created but now find ourselves unable to pay,” Munro said Friday. “Ontario’s public sector pensions are facing an unfunded liability that could add up to billions of dollars and Ontarians are on the hook.”
The Tories will release a white paper Monday with proposals on “sustainable retirement security.”
Ontario Finance Minister Dwight Duncan made public a report by pension investment adviser Bill Morneau Friday that calls for the pooling of pension fund asset management in the public sector.
“I am pleased to report there is a significant opportunity for pension funds to realize benefits from the economies of scale and other advantages that a pooling framework would generate,” Morneau says in his report. “Implementation of such a framework would reduce duplication and costs, broaden access to additional asset classes and enhance risk management practices.”
There are more than 100 public pension funds in Ontario.


Munro said she doesn’t object to the pooling framework but finds the savings small in comparison to the overall looming problem that public pensions appear to owe their workers billions of dollars more than they can afford to pay out.
“The government must be clear with taxpayers about who is responsible for funding deficits of public sector pensions,” she said. “However, the Liberals will not even admit the scope of the problem or acknowledge the long-term threats to our pension system.”
Aly Vitunski, a spokesman for Duncan, said the Morneau recommendation offers a savings to taxpayers of $100 million.
“The PCs always tell us chase every penny of savings possible, however Munro claims these savings are insignificant,” Vitunski said in an e-mail. “She’s off the mark on this one and by a lot.”



Ontarians could face billions in unfunded pension liabilities- Politics - Canoe.ca


Oh, this'll be fun when the public sector boomers retire.
 

captain morgan

Hall of Fame Member
Mar 28, 2009
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Nothing about the public sector is realistic.


Very true, but now that the reality is smacking everyone square in the face, I believe that we will see a major over-haul in the equation that defines the public sector pension plans (excepting the MP's of course).

If I'm not mistaken, aren't new employees in the postal service subject to new pension arrangements?.. I guess that we are observing the evolution as we speak.
 

SLM

The Velvet Hammer
Mar 5, 2011
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London, Ontario
Very true, but now that the reality is smacking everyone square in the face, I believe that we will see a major over-haul in the equation that defines the public sector pension plans (excepting the MP's of course).

We should be seeing a redefinition of MP's as well. Not that we will be, but we should be. Should be demanding it actually.

If I'm not mistaken, aren't new employees in the postal service subject to new pension arrangements?.. I guess that we are observing the evolution as we speak.
I'm not sure to be honest, I don't follow postal service news all that religiously, lol. Postal service 'downsizing' has been going on for a long time, it's not as much of a necessity as it was 20 years ago, maybe even 10 years ago. So the writing has been on the wall for some time now as far as new pension arrangements anyway.

Not that I'm opposed to anyone, privately or publicly employed, earning a living rate or having a decent pension but these golden parachutes of a bygone era, as you said, are ultimately unsustainable. Yet government's been chugging along as if it is.
 

captain morgan

Hall of Fame Member
Mar 28, 2009
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We should be seeing a redefinition of MP's as well. Not that we will be, but we should be. Should be demanding it actually.

That will never happen as long as the MPs have the exclusive vote on their own, individual compensation and pension arrangements... No different that letting a bunch of children loose in the candy store and asking them to have a vote on whether they should get as much free candy as they can carry



I'm not sure to be honest, I don't follow postal service news all that religiously, lol. Postal service 'downsizing' has been going on for a long time, it's not as much of a necessity as it was 20 years ago, maybe even 10 years ago. So the writing has been on the wall for some time now as far as new pension arrangements anyway.

Not that I'm opposed to anyone, privately or publicly employed, earning a living rate or having a decent pension but these golden parachutes of a bygone era, as you said, are ultimately unsustainable. Yet government's been chugging along as if it is.

If you think back a few years, Canada Post began to outsource their facilities and staffing to third parties (7-11 and drug stores come to mind). In my eyes, that was the first sign that the corporation was restructuring the operations and you being in finance and seeing these transitions, employee related costs get heavily scrutinized from that point forward.
 

SLM

The Velvet Hammer
Mar 5, 2011
29,151
3
36
London, Ontario
That will never happen as long as the MPs have the exclusive vote on their own, individual compensation and pension arrangements... No different that letting a bunch of children loose in the candy store and asking them to have a vote on whether they should get as much free candy as they can carry

Screw 'em. Let's overthrow the government. Ya with me?;)

If you think back a few years, Canada Post began to outsource their facilities and staffing to third parties (7-11 and drug stores come to mind). In my eyes, that was the first sign that the corporation was restructuring the operations and you being in finance and seeing these transitions, employee related costs get heavily scrutinized from that point forward.
That's exactly what I was thinking of. I can't remember the last time I was in an actual Post Office. I remember them from my childhood though.

Employee related costs tend to always get the heaviest scrutiny because, rightly or wrongly, it's simply the easiest thing to cut to see a result in a short span of time.

I think overall what we've gotten really far away from is a sense of fairness. I do work with a lot of businesses and business owners, their goal is not to put people out of work, not by a long shot. On the other side of it, workers want some kind of reliability and to know that they can get by on what they earn, for the most part. It's not a matter of right and wrong it's a matter of how do we work together to achieve those ends. I think a lot of people are still really stuck on the "old way of doing things". I think we all, employers and employees alike, need to do a radical rethinking of the relationship moving forward.

I'm not saying I know what the "answer" is because honestly all I see, on both sides of the issue a lot of times, are problems. And when there are problems, when things get tough, we all have a tendency to retreat and look after 'our own', which really just exacerbates the whole thing.

Sorry, getting slightly off topic. lol. But it is all related in the end.
 

Ron in Regina

"Voice of the West" Party
Apr 9, 2008
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Oh, this'll be fun when the public sector boomers retire.

Oh yeah....and this seems to be a chronic and endemic issue pretty much everywhere.

The pension idea works when the population is pyramid shaped with a wide base with
much fewer at the top (many youth=many having many children=many taxpayers pay'n
in but not yet collecting...and comparatively less retiree's living shorter lifespans).

Factor in smaller families with maybe one of two children now, and better diets and
health care with less physically strenuous lifestyles, and more people are living longer
I believe. It'll be interesting times in the years to come.
 

taxslave

Hall of Fame Member
Nov 25, 2008
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Oh yeah....and this seems to be a chronic and endemic issue pretty much everywhere.

The pension idea works when the population is pyramid shaped with a wide base with
much fewer at the top (many youth=many having many children=many taxpayers pay'n
in but not yet collecting...and comparatively less retiree's living shorter lifespans).

Factor in smaller families with maybe one of two children now, and better diets and
health care with less physically strenuous lifestyles, and more people are living longer
I believe. It'll be interesting times in the years to come.

That has been pretty much the premise our governments and unions have been working on since at least the 1940s. In recent years unions have been forced to join up because of an ever decreasing dues paying base to cover their previous pension obligations. Young people now joining these unions may be paying more into pension funds than they can possibly collect.

Funny thing about all this is that any business using this model would be hauled off to jail for running a pyramid scheme.

Count me in.

A couple of questions though first:


  1. Will there be snacks?
  2. I know this may be the wrong time, but, ummm... What kind of pension bennies come with this?

3- Double time for OT?
 

damngrumpy

Executive Branch Member
Mar 16, 2005
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Let us get a few things straight here. One if the plan was not realistic in the first place that
is not the fault of the customer those who contributed to the fund. Here is why the only real
reason they might have been inflated was because the governments of the day, in Ontario,
that include Tories, Liberals and New Democrats over time, instituted the plans for the
purpose of borrowing from them down the road. Now it is time to belly up to the bar as it were.
This money was used for roads, bridges, advancing tax wirte off's to business, and reducing
corporate taxes to stimulate competition. In addition all these parties engaged in the practics
of forgivable loans to certain sectors and so on.
The people paid in good faith and the government squandered the money. The people are now
drawing money out of the fund and therefore their benefits should be reduced, I don't think so.
If politicians mishandled the funds they should be charged with innappropriate use of those funds.

I hear people whine about Quebec and why their pension plans and medical plans are so much
better than the rest of Canada. Well the governments of Quebec actually set up pension and UI
Insurance, family allowance and medicare accounts and invested in them for that purpose.
The other nine provinces built roads and off set taxes with them and now the piper is playing.
If Ontario and other provinces have a similar problem its time to claw back all those generious tax
brakes they handed out a few years back. It is not time to gut service plans that people paid into.
because politicians made bad choices.