Pensions are, in effect, the fruit of forced savings. Workers forego wages now for the promise of income after retirement.
The actual payments are usually split between employer and employee. But conceptually, both represent the same thing — deferred wages.
In North America, company pension plans took off during the Second World War as a way to get around wage controls. It might be illegal to offer scarce workers higher wages. But it was all right to offer non-wage benefits like pensions.
After the war, the growth of unions encouraged the expansion of company pension plans. But it was always a minority of workers who benefitted from them.
The quality of your pension depended on how well managed your company was. If you were lucky, you retired well. But companies go bankrupt. And, if you worked for Sears or Nortel, you were left up the creek.
That is why Walkom believes the best solution is to expand the public pension system:
The actual payments are usually split between employer and employee. But conceptually, both represent the same thing — deferred wages.
In North America, company pension plans took off during the Second World War as a way to get around wage controls. It might be illegal to offer scarce workers higher wages. But it was all right to offer non-wage benefits like pensions.
After the war, the growth of unions encouraged the expansion of company pension plans. But it was always a minority of workers who benefitted from them.
The quality of your pension depended on how well managed your company was. If you were lucky, you retired well. But companies go bankrupt. And, if you worked for Sears or Nortel, you were left up the creek.
That is why Walkom believes the best solution is to expand the public pension system:
The CPP is well-run and financially self-sustaining. As the Sears saga demonstrates, even the biggest private enterprises can go out of business. The government of Canada, which ultimately backs the CPP, cannot easily do the same.
If there is a future in pension reform, it is with the CPP. Changing the bankruptcy laws to put pensioners at the front of the queue, as both the New Democrats and Bloc Québécois suggest, is a fine idea. But it doesn’t deal with the fact that the company pension plan such a move would protect is a thing of the past.
more
https://www.thestar.com/opinion/con...p-is-best-way-to-protect-pensions-walkom.html
If there is a future in pension reform, it is with the CPP. Changing the bankruptcy laws to put pensioners at the front of the queue, as both the New Democrats and Bloc Québécois suggest, is a fine idea. But it doesn’t deal with the fact that the company pension plan such a move would protect is a thing of the past.
more
https://www.thestar.com/opinion/con...p-is-best-way-to-protect-pensions-walkom.html
