Evidence of meeting #41 for Status of Women in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was retirement.
A recording is available from Parliament.
4:30 p.m.
Union Advisor, Education Department, Fédération des travailleurs et travailleuses du Québec
The legislation is federal, so--
4:30 p.m.
Conservative
4:30 p.m.
President, Confédération des syndicats nationaux (CSN)
I see this as a very serious issue. It's quite true that what happens to retirees when a bankruptcy occurs is absolutely devastating. However, before deciding that they should be preferred creditors in cases of bankruptcy, a great deal more thought has to be given to this.
It is clear to me that this is a serious issue, but we also want to take the time to look at other avenues, as opposed to just believing that this is the magic bullet. There could be significant disadvantages to an approach based solely on the fate of retirees.
In terms of jurisdiction, the whole area of pension funds is closely linked to the tax system. We are currently part and parcel of the federal system. We won't make our constitutional choices within that framework, but we have no choice but to acknowledge that they have always provided guidelines, where the tax system is concerned. In that regard, we cannot just ignore what happens at the federal level. It is an area of great interest to us.
4:35 p.m.
Conservative
The Acting Chair Conservative Dave Van Kesteren
Thank you.
We now move to our second round. Oh, I'm sorry, that will be after we finish the first round.
Ms. Ashton.
4:35 p.m.
NDP
Niki Ashton NDP Churchill, MB
I would like to thank you for your presentation on pensions, which was very instructive.
My question is related to the next generation. I am the youngest woman in the House of Commons. The realities of my generation and the challenges we are facing are a concern for us all. The pension issue may not be the ultimate priority for many young people, but if we don't invest properly, we will pay the price later in our lives.
My question is addressed to all of you. It's about
labour market—I'll switch into English—and the labour market changing, especially the issues facing the next generation of people in their twenties and early thirties: increased contract work, decreased work in environments that are not unionized, and certainly a lack of stability in terms of the work they're looking at. Certainly we've heard about the intergenerational piece, but with this changing labour market, I'm interested in knowing what we need to be doing in terms of our pension plans in order to face that reality that people my age—certainly my generation—will face when they get to retirement age. I'd be interested to hear your thoughts specifically in terms of that generation.
4:35 p.m.
Consultant and Research Associate, Canadian Centre for Policy Alternatives
I mentioned the number of people who are employed in so-called non-standard jobs, the kind that you've just outlined—contract work, temporary work, and so on. As I said, 40% of women's jobs are now those kinds of jobs, compared with 30% of men's jobs. Most of those jobs have instability built in. They don't have benefits; they don't have pensions. So people who are in those kinds of jobs.... In total, 35% of all employment in Canada is in that kind of work. So they are not likely to have pension plans. They're not likely to develop pension plans, because they don't have permanent full-time long-term employees. This means the public pension plans become even more important.
The CPP does cover those jobs. Part-time workers are covered by the CPP. Self-employed workers are covered by the CPP. Despite some witnesses who have appeared before you saying they weren't, they are. The problem is that they have to pay double contributions. They have to pay the employer part and the employee part. So it becomes very expensive.
Let's say you're somebody working on your own on contract, but technically you're self-employed. If you want to be in the CPP, you must pay 9.9% of your earnings to the plan, whereas if you were working for a big company, the employer would pay half and you'd pay the other half. So it makes it very difficult for younger workers to contribute, even to the CPP.
There is one thing that could be done and I think this would be worth exploring. There is a tax credit for contributions to the CPP. At the end of the 1990s, when discussions on changes to the financing of the plan were going on, it was suggested that changes be made to that tax credit--that it could be improved for lower-income workers and that it might even be adapted to be based on a person's income, so that the lower the income the better the credit would be. Various things like that could be done to make it easier for younger people and people in those unstable jobs to contribute to the plan.
Another possibility would be to regulate temporary health agencies and make them like employers. This comes under labour standards legislation, which is a provincial matter, and also federal for those federally regulated employers. If temporary health agencies were technically employers, then they would have to contribute to the plan on behalf of the people they employ.
So it's a number of things like this that should be explored to make it easier for younger workers like those you describe to do their contributions to the plan, so that they will get pensions from the CPP when they come to retirement.
4:40 p.m.
Union Advisor, Education Department, Fédération des travailleurs et travailleuses du Québec
With respect to young people, I would just like to say that public plans are completely transferable. Young people often worry about having to hold a number of jobs in their lifetime, and wonder how they will manage both the public and private plans.
For young people, however, the public plans are quite attractive because they are plans that will follow them for the rest of their lives. They are universal plans which are generally well managed, and whose administrative and management costs are much lower than for private plans.
4:40 p.m.
President, Confédération des syndicats nationaux (CSN)
In terms of the CSN position, I support many of the comments that have already been made. I believe the first priority is to avoid weakening the public plans, at the very least. She is absolutely right when she says that our plans, be they private or public, are not geared to the new realities of the labour market.
The same applies to temporary help agencies, workers with unstable jobs, and changes in family structure. In that respect, the same also applies to mobility from one company to the next. The only thing I would like to add to what has been proposed—and this is something we strongly support, among other options—would be to bring in industry-wide plans. That would at least enable mobility and, very often, it allows people to continue their career in the same industry.
In that sense, the answer is, to a large extent, to change the system to reflect the realities of the current labour market and the status of young people on that labour market.
4:40 p.m.
Conservative
4:40 p.m.
Conservative
November 19th, 2009 / 4:40 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
Thank you, Mr. Chair.
I would like to thank all our witnesses for being here this afternoon and assisting us with our study on women and pension security. My first question is for Ms. Carbonneau.
Ms. Carbonneau, your idea of grouping companies, such as daycare centres, strikes me as very innovative. But would it not be complicated to do this? Would it not only affect a small percentage of employees? And who would take the initiative to bring them together under one plan?
4:40 p.m.
President, Confédération des syndicats nationaux (CSN)
I would like to ask Ms. Joncas, who was the negotiator in this area, to answer your question.
4:40 p.m.
Actuary, Confédération des syndicats nationaux (CSN)
There is no doubt that, in every sector, be it the construction industry in Quebec or daycare centres, when there is a desire to establish an industry-wide plan, there must also be a government desire to set up such a plan, in order to lessen the burden of employers or force them to contribute to a plan based on conditions that are somewhat different from traditional plans—in other words, multi-employer plans. Even if an industry wants to come together and ensure some uniformity, there has to be a willingness on the part of government to make that happen.
However, in some countries, such as the Netherlands, the government has taken the initiative of determining which sectors or industries would be appropriate and setting up plans on an industry-by-industry basis. There can also be--
4:40 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
Pardon me for interrupting you. Are you saying this system already exists in other countries?
4:45 p.m.
Actuary, Confédération des syndicats nationaux (CSN)
Yes, the Netherlands has plans of this type in place, particularly in the industrial sector. They have three major industry-wide plans where the risk is borne by all companies operating in that industry, but the specific sectors are determined by government. So, such plans are already in effect. They are all defined benefit plans as well, but the number or volume is such that there is much better risk management. Those plans came out of the crisis in better shape than many of our major defined benefit plans, because the administration and governance of these large plans is not handled by the companies themselves—it's a model somewhat similar to that of the Ontario Teachers Pension Plan, where the entire education sector is grouped together under an industry-wide model, with governance of the plan being handled completely independently of both employees and employers.
4:45 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
You say that the private plans are fragile; so, do you not think there should be government intervention to ensure that those plans are safe?
4:45 p.m.
Actuary, Confédération des syndicats nationaux (CSN)
I do think the current model needs to be reviewed. The federal government and many provinces are trying to review their model but, so far, reforms are not significant enough.
It's as though there has been just tinkering so far; there have not been any substantive changes aimed at finding new models that would be more geared to needs or be more effective. We know there's a problem, and there is an attempt to correct it, but pension reform--
