A Top Priority for NDP Opposition?
Jeff Lee of the Vancouver Sun reports, Layton singles out pension reform in Vancouver:
NDP leader Jack Layton signalled Wednesday that pension reform will be his party's main thrust as the official Opposition, saying Prime Minster Stephen Harper is "practically alone in ignoring the looming retirement security crisis."
In his first major speech since winning 103 seats in the May 2 federal election, Layton told delegates at the Canadian Labour Congress in Vancouver that "yes, Stephen Harper won a majority, but he is facing the largest, most united official Opposition in 31 years."
It is a reference to the 1980 election in which Pierre Elliott Trudeau returned to power with a majority, reducing Joe Clark's Conservatives to 103 seats.
Layton said the NDP will use their strength in Parliament to pressure the Harper government to improve retirement security for Canadians, many of whom he said had seen their savings wiped out in the recession.
Layton's speech to the entirely friendly CLC convention came after an election that propelled his party to official Opposition status and gave the Conservatives a solid majority with 166 seats. The Liberals were reduced to just 34, and the Green party won one. The NDP's rise included 59 seats in Quebec, where the once-dominant Bloc Quebecois was reduced to a rump party of four seats.
In a scrum with reporters later, Layton also weighed in on B.C.'s HST referendum, saying he doesn't think taxpayers should have to repay the $1.6 billion Ottawa gave to Victoria if the tax is voted down this summer.
He said it would be too late to collect back Ottawa's prepayment.
"It is not the fault of the people of British Columbia that this policy was brought in. It is Stephen Harper's fault and Gordon Campbell's fault. That money has already gone into education and health care."
And he said the Harper government needs to go after "the collusion" that may exist between gas companies in light of the recent spike in prices at gas pumps.
"We believe Ottawa should play a role here, and that we need to get really tough with our anti-competition bureau should go after the collusion that may or may not be taking place. It is tough to prove it with these companies, of course, but you need to have real teeth there," he said.
But it was on the issue of pension reform and retirement security that Layton spent most of his time. He said provincial governments have already recognized the "brewing storm" and are wanting to strengthen the Canada Pension Plan and the Quebec Pension Plan.
"So far, Stephen Harper has not been a willing partner," he told convention delegates.
In his scrum, Layton said Harper ignores Canadians' concern over retirement security at his peril. One only has to look at Quebec, where the NDP won so many of its seats. Quebecers are deeply worried about the Quebec Pension Plan, he said.
"[Harper's] complete absence of real commitment to deal with the retirement security crisis that so many seniors or near seniors are facing is one of those issues we're going to push very hard," he said.
"We're suggesting the whole question of pension reform and strengthening peoples' retirement security could be one of those areas where he can demonstrate he's actually been listening to Canadians."
The Conservatives have instead opted for a private pension scheme and have put improvements to the Canada Pension Plan on a slow track.
Layton brushed aside questions that continue to dog Ruth Ellen Brosseau, the young Quebec MP who was elected without ever having visited her riding of Berthier-Maskinonge and instead went on a vacation to Las Vegas. He said Brosseau was in her riding Wednesday. He refused to say whether the party would insist all future MPs first visit their ridings before seeking election, calling the question hypothetical.
But he said he found it contradictory that people complain when young people don't vote or get engaged in politics, and then complain again when they do and end up getting elected.
"Now that they got out to vote and some of them ran for election and some of them won, now we're saying that's not right that these young people got elected as members of Parliament," he said. "To me that is ridiculous and most young people and others are seeing really how silly that is."
Someone told me I should have ran for the NDP. I'd be collecting a $158,000 a year paycheck as an MP and if I won a second term, I'd be collecting a nice gold plated pension (managed by my former employer, PSP Investments).
The problem is that I am fiercely independent and have have little patience for political posturing. The last time I testified at Parliament Hill, I left MPs from all parties with their mouths open (you should have seen the look on their faces -- priceless!!). Can you imagine if I was in Ottawa now as an MP debating pensions? I'd make a lot of powerful senior pension fund managers in Canada very nervous.
I'd probably start by exposing the risks public pension plans are taking, carefully examining leverage and other risks across all investment portfolios. I'd demand a hell of a lot more transparency, including detailed discussion on benchmarks and board minutes. I'd then ask those polite folks at the Treasury Board to dust off that 100 plus page report on the governance of the Public service pension plan I prepared for them back in 2007 that was suppose to be followed up by the Auditor General of Canada (not surprisingly, they buried it as it scared them to death, and to my knowledge, none of my recommendations were ever implemented or followed up on by the Auditor General of Canada). I'd educate MPs on the good, bad and ugly of pension fund governance in Canada and what needs to be done to bolster our public pension system.
Having said this, I'll tell you one thing, while our public pensions aren't perfect, they're infinitely better than the private sector defined-contribution (DC) plans that banks and insurance companies are peddling. In my open letter to Prime Minister Harper, I praised the Conservatives for introducing tax-free savings accounts (TFSAs), but I also stated that we need to reform our pension system and that the Liberal and NDP platforms on pensions are way ahead of what the Conservatives are proposing because they're not pandering to banks, insurance and mutual fund companies.
I'm not against the private sector, and do see a role for them managing money, but in my ideal world, corporations would shift over their pensions (DB and DC) to new government sponsored Crown corporations which would invest in both public and private markets around the world. These new entities would follow the best pension fund governance standards from across the world and they would be capped at a certain size so we'd avoid having a behemoth fund like Japan's giant GPIF (at one point, economies of scale work against you).
But how can we afford public defined-benefit plans for everyone? Private sector interest groups like the Canadian Federation of Independent Business are calling for the end of unions and attacking the proposal to expand the CPP. Unfortunately, the current CFIB president, Catherine Swift, is absolutely clueless on pension matters.
When I was working at the Business Development Bank of Canada (BDC), I urged senior managers there to look at pensions and come up with a cost-effective way of pooling resources from Canadian small businesses. The money can be managed by the Canada Pension Plan Investment Board (CPPIB) or one of the new entities I discussed above. Small businesses want access to a safe retirement, much like the ones MPs and civil servants have, but they're scared off by a bunch of fear mongering nonsense that Ms. Swift and others are peddling when they state we can't afford it (I think we can't afford not to reform our pension system).
Speaking of rubbish, Jonathan Chevreau of the right-wing National Post wrote another terrible article attacking the NDP proposal. This is the same guy who attacked "Big CPP" and showed me he too is clueless of the benefits of public defined-benefit plans. It doesn't matter whether you're on the right or left end of the political spectrum, facts are facts. And the fact is that large Canadian public defined-benefit plans have outperformed private sector defined-contribution plans over the long-term and will continue to outperform them for the simple reason that they're cheaper and can invest in the best managers around the world in both public and private markets.
At the end of the day, all Canadians should enjoy the same retirement security that MPs and the federal civil service are entitled to. We have enough smart actuaries and investment professionals to figure out the cost and management of such a proposal but it's high time we stop peddling nonsense and actually do something to bolster our pension system. And let's start by building on what already works well, our large public pension plans which are among the best in the world. If we do this right, we will become global leaders in pension reform. If we do nothing, we'll ensure more pension poverty down the road.