Pension Benefits Guarantee Fund, Ontario Retirement Plan
3 Apr 14 OpEd
When I was first elected in 2007, I told the NDP Leader, that I wanted to take action to protect pensions and to make working life and retirement better for all workers.
To achieve that goal, I worked with my colleagues to bring forward an Ontario Retirement Plan that would provide a provincial pension plan similar to the Canada Pension Plan, portable to any employment in Ontario, managed by public pension plan administrators and protected for life. It was a good idea that the current government has taken and remodelled.
But what hasn’t yet come to legislation is protection for those workers whose employer closes up shop and winds down their pension plans. For these retirees, they face a reduction in their retirement income by more than half. This is their money, taken from their pay cheques; money that they saved in their company pension plan; money that they will lose in the case of a pension plan being wound-down by their employer.
Many retirees depend not only on their monthly retirement income, but in some cases, the benefit plan that went with their retirement package. Although we cannot legislate continuance of a benefit package, we can legislate better protection of a retiree’s monthly income.
When the government engaged Professor Harry Arthurs to investigate and report on pensions and how we can provide better security for the pension system, one of the things that he recommended was an increase in the Pension Benefits Guarantee Fund. This Fund was created in the 80s to provide some protection for retirees whose pension plan was wound-up. It guaranteed $1,000.00 per month to replace the pension plan income that retirees were receiving.
So if you received $1,000.00 per month, your income remained the same, however, for any amount that you would have received in excess of $1,000.00, you lost it. You would lose those hard-earned wages that you invested in your company pension plan. Professor Arthurs recommended that the Pension Benefit Guarantee Fund be increased to reflect what the current value of those 1980s dollars would be – $2,500.00 per month.
On Thursday April 3rd, we will debate my Private Member’s Bill 174, Pension Benefits Amendment Act, 2014, which will take the necessary action to bring the Pension Benefits Guarantee Fund to current value.
Although the government has proposed an Ontario pension plan, I have not yet heard what commitment it will make to those many retirees who have had their planned retirement income completely upset and may not receive anything near what they saved and planned for. It is my goal to get all three parties to work to-gether on Thursday and support Bill 174, bringing better financial security to those workers who trusted the pension system and put their wages into a company pension plan.
I will post on my website, www.paulmiller.ca, the results of Thursday’s vote on Bill 174 and let you know whether it is passed onto a Standing Committee for public hearings.
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