Mr. Speaker, when the hon. member talks about shared risk, one cannot help but talk about shared management. It has always been the goal of any pension plan to have joint trustees; representatives of the employees and the employer sitting on the same board, having some control and direction over investments made or the direction in which the plan might be going.
I know this was one of the sore points at the table when talks broke down in December 1998. The government would not allow any input from employees in terms of ethical investment funds or control of the types of investments that the new public sector investment board would make.
What if the investment board wanted to invest in a janitorial company which had contracted with the federal government to clean the Wellington Building and, as a result, put public sector plan members out of work? Frankly, under the board's fiduciary responsibility, if that janitorial company was paying on the stock market one quarter of a point higher than the other investment, it would be its obligation to invest there. There can be no other consideration than to maximize the profits of the investment.
Most plans are run that way, but many pension plans qualify the fiduciary responsibility by saying that there are secondary objectives which they are trying to achieve. Maybe it is job creation for the plan members, or rural or regional economic development. There could be any number of purposes. When dealing with tens of billions of dollars of investment on the stock market, it could be directed to achieve secondary and tertiary objectives other than purely profit objectives. That fell apart.
The shared risk or responsibility dialogue was taking place at the same time. There is far greater chance of there being a surplus than a deficit because of the actuaries who are hired to run the plan. The way that any well managed pension plan is run is that premiums are set at a rate which will offset the liability at the other end. Premiums will go up. In the near future we will not see deficits, but rather humongous surpluses.