Madam Speaker, I am pleased to have the opportunity to speak today in support of Bill C-78, the Public Sector Pension Investment Board Act.
Pensions are a complicated business and this is a very complicated bill. Much of it is about putting the pension plan for federal employees, the public service, Canadian forces and the RCMP on a solid financial footing. We know how important pensions are to all Canadians, but we also know that how we provide pensions for these federal public sector employees has to be fair to all taxpayers.
Other people will be talking in more detail about the financial arrangements that are being proposed in the bill. I want to take some time today to talk about the Canada Post section of it and how the bill affects the corporation and its employees.
What the bill says is clear and fairly straightforward. By October 1, 2000 Canada Post Corporation will establish a pension plan for its employees that are now covered by the Public Service Superannuation Act, the PSSA.
The plan that Canada Post establishes has to meet the requirements of the Pension Benefits Standard Act and the Income Tax Act. Once the plan is established the PSSA will cease to cover Canada Post employees. On the day it is established the Canada Post plan has to provide the same benefits as the PSSA at the same cost to employees.
The funds now in the PSSA are there to provide the benefits that Canada Post employees have already earned and will be transferred to the new plan. I am told and I understand that the transfer of funds will be about $6 billion. The benefits for the past will be exactly what they would have been under the PSSA and they cannot be reduced in the future.
A year after the new plan is established on October 1, 2001 it will become subject to collective bargaining, except those parts of the plan that deal with the service and benefits coming from the PSSA.
There are some other features in the bill that are important to employees, opportunities to count past service and a life insurance plan that is a mirror of the one employees are leaving, and some that are important to the corporation such as the right to determine how any plan surplus will be used and the right to establish more than one plan. These are the main features.
Why is this all being done? For Canada Post this is a decision based on business because of a number of factors. First, like all other corporations under the PSSA the employer costs for the pension plan will increase. For a corporation with a commercial mandate, the bottom line impact has to be looked at very seriously.
Canada Post operates under the Canada Labour Code. Under the code all terms and conditions of employment are subject to collective bargaining. As long as it was under the PSSA, though, it could not bargain pensions which are a significant part of total compensation. There is a real opportunity here for Canada Post to assume total responsibility for all aspects of its operation and its management but, and this is very important, the legislation is good for employees too.
First, it promises the same level of pension benefits as they would have under the PSSA. The guarantees in the bill about the benefits employees have already earned are very strong. Second, it makes pensions bargainable.
Some people will wonder why Canada Post employees will be able to bargain pensions when public service employees cannot and why they should be able to affect the design and management of their pension plan when public servants under the PSSA cannot.
As the President of the Treasury Board outlined in his speech, a consultation process took place over a number of months last year. That process was intended to lead to a joint management structure for the PSSA so that employees could have shared in all the decisions around their pension plans. Those talks did not lead to a deal, but the government is still ready to talk to the unions about joint management.
For Canada Post and its employees, not being able to include pensions in bargaining is an unusual restriction for an organization that functions under the Canada Labour Code.
There may also be people who wonder why pensions are not subject to the labour code right away. Some people will say this is an exceptional treatment under the labour code, and they are right. However this is an exceptional case.
Some 50,000 employees are affected by the decision on the part of Canada Post to withdraw from the PSSA. These employees are located all across the country. The government is interested in the concerns of Canada Post and in helping the corporation to create a business environment where it can succeed.
It is also very interested in making sure employees can feel secure about their pensions. Employees can know by this legislation what their new pension will look like, what kind of benefits it will provide and how much it will cost. Employees need not have any uncertainty about these things. They are very strong guarantees.
The provisions of the bill affecting Canada Post Corporation and its employees do not look like a big part of the bill, some two or three pages, but they will help Canada Post move forward in its efforts to provide good service to all Canadians and will give it another piece of the framework for managing the people part of its business.
These same provisions give employees guarantees about pensions, a very important part of compensation, and give them the opportunity to influence how their pensions will evolve in the future.
Speaking from my very limited experience when I negotiated contracts as chairman of the Peel board back in another life in another time, the actual salary compensation was oftentimes less important than everything else negotiated in the contract. I found that people, particularly as the population of Canada is aging, were very concerned about their pensions and their pension rights. They wanted to have a say in how the money was being distributed and how it would affect their pensions.
I wholeheartedly agree with this legislation. It is giving power to the people and responsibility to the government.