Mr. Speaker, I am pleased to join the debate on Bill C-18 regarding RCMP pensions.
I want to compliment my colleague from St. John's East for his work on this issue on behalf of the NDP caucus. I think the speech he made in the House recently capably outlines the NDP's position on Bill C-18.
To put my remarks about RCMP pensions and the public service pensions generally in context, I would like to recognize a former NDP member from my riding of Winnipeg Centre. The hon. Reverend Stanley Knowles represented the riding I now represent from 1942 until he was felled by a stroke in 1984. He dedicated much of his political career to fighting for pensions and old age security. He is recognized by many as the father of the old age security system in this country because of his doggedness in sticking to this one issue over a 42-year career.
The notion of ending poverty among the aged and income security had its origins in this country in 1925-26, when my predecessor for the riding of Winnipeg Centre, J. S. Woodsworth, with the Independent Labour Party, was elected to the House of Commons.
In 1925-26, William Lyon Mackenzie King found himself in a minority situation. Many students of parliamentary history will know the King-Byng affair. King was in a minority situation, and he needed the support of J. S. Woodsworth and the small Independent Labour Party. A. A. Heaps, another member of Parliament from Manitoba, was a labour leader, one of the leaders of the Winnipeg general strike, as was J. S. Woodsworth.
It is interesting, in fact the Government of Canada wanted to send J. S. Woodsworth to prison for his role as a leader of the Winnipeg general strike but the people of Winnipeg Centre sent him to Ottawa to be their member of Parliament instead. He stayed there for 22 years.
It is interesting as well that the charges of treason against J. S. Woodsworth were laid against him because he was quoting the Bible, the Book of Isaiah. He was speaking to a large gathering of strikers during the 1919 Winnipeg general strike. He pointed out that we are our brother's keeper on this earth, et cetera, and for these words he was charged with inciting a riot and was thrown in prison.
Like many leaders of the 1919 general strike, and it is the 90th anniversary of that strike this year, they were elected to the provincial legislatures, to the municipal chambers of Winnipeg and to the federal House of Commons from their prison cells.
It was J. S. Woodsworth who cut a deal with King in a letter, a promissory note. J. S. Woodsworth said, “I will support your government”--the King government of the day--“in exchange for old age security. If this Parliament will introduce old age security, old age pensions, I will support your government”.
King agreed to that in a famous letter, which is in the archives of the New Democratic Party. It was the member for Winnipeg Centre, J. S. Woodsworth, who used his political leverage to introduce pensions in this country.
Fittingly, after 20-some years as the member of Parliament for Winnipeg Centre, when Woodsworth was succeeded, Stanley Knowles took up that crusade. He dedicated a long and illustrious parliamentary career to establishing old age security. He was not only satisfied when he achieved the old age security of $50 a month, he started another fight that very day. The very day that it passed in the House of Commons another battle began, to have it indexed to inflation so that old age security would be meaningful.
I think we all know that while the incidence of poverty among seniors, especially elderly women, is still problematic, it is nothing like it used to be. We have a fairly robust retirement income system for our seniors.
Having said that, Bill C-18 deals with the RCMP pension, the Royal Canadian Mounted Police Superannuation Act. It makes a modest reform to the administration of that act.
It is impossible to talk about the RCMP pension without talking about public sector pensions more generally, because the two are directly connected.
The RCMP pension became an issue of great controversy at the public accounts committee in the last Parliament. The head of the RCMP was hauled before that committee, and she was grilled about her involvement in the administration of that pension plan. She was found to be in contempt of Parliament, an extraordinarily unusual circumstance. She was hauled before the bar of Parliament and found to be in contempt of this place. The administration of the RCMP pension has not been without controversy, and it should not be tread upon lightly.
As a former trade union leader and trustee of an employee benefit plan, I can say that all public and private sector pensions should have joint trustees. There should be representation on the board of trustees of the beneficiaries of the plan, the retirees who are getting benefits from the plan as well as the people making contributions to the plan. Either they or their representatives should be adequately represented. I would argue they should be represented fifty-fifty so their voices can be heard on the administration of these pension plans. They are huge. Most of the trading on the New York Stock Exchange and the Toronto Stock Exchange is in fact from employee benefit plans that are moving money around.
This is the new face of capitalism. Union pension plans are driving the venture capital markets, and the markets generally. It takes a fair amount of expertise to watch over that amount of trading, to make sure that it is done in the best interests of the beneficiary. We certainly have all learned a lot of lessons because of the complex financial engineering that goes on in the financial markets of today. It takes a great deal of expertise to make sure our pensions are being cared for, and the RCMP plan is no different.
I would say that white collar crime is very much a blue collar issue. We need to be able to trust the financial statements of the companies in which our pensions are invested. If we cannot trust those financial statements, our financial security is in deep, deep trouble, no matter what we do with the RCMP Superannuation Act or any of the pension legislation.
The first thing we have to do is clean up the corporate governance on the financial markets where our pensions are invested. That is for another day, I suppose. One thing that has always bugged me, and I will raise it here to put it on the record, is that in the corporate world, at least in Canada, we can hire the same company to be our tax adviser as our auditor.
Surely to God we have learned the lesson from Enron that we want our auditors to be independent. We do not want the same company, Arthur Andersen, to give us advice on how to structure our books and play games to avoid taxes, how to juggle money, hide things and play the shell game, and then be the same company that audits those books and puts a seal of approval on them.
What is a blue collar trustee of a union pension plan supposed to do? Who are they supposed to believe? All they can do is read the financial statements that are put in front of them to try to figure out if they are accurate. We have to be able to trust the financial statements of those companies or we are in deeper trouble than the administration of this RCMP plan.
Let me also raise the issue that surpluses in public sector pension plans should be considered the property, the deferred wages, of the beneficiaries of the plan.
As his last action as Treasury Board president, Marcel Massé changed all that in 2000. There was a $30 billion actuarial surplus in the public service pension plan. He knew this action was political suicide, so, as he was going out the door, he passed a bill that said employees had no proprietary claim on surpluses in pension plans.
That was news to us. We always thought our pension plans were our earnings held in trust for us and invested wisely so we could retire with some dignity. In fact, we negotiated that at the bargaining table. Instead of taking a $1 raise, we would take a 50¢ raise and the other 50¢ would be put in the pension plan to grow and we would take it when we needed it. Marcel Massé changed all that.
It has had a ripple effect in the private sector as well, which claims that any surplus in a pension plan is the property of the employer not the employees. That should be condemned. In fact, it should be fixed.
There is an assault on pensions generally. It is absolutely mind-boggling that analysts of the day, after reviewing the global economic crisis in North America at least, are not finding fault with bad management or bloated CEO benefits. They are not finding fault with car companies that manufacture products nobody wants.
These analysts have arrived at the source of the problem of our economic crisis. It turns out that greedy union pension plans are dragging us all down the road of perdition. We did not realize this as trade unionists when we were negotiating fair retirement benefits for our members. We did not realize we were dragging down capitalism as we knew it.
Apparently those corporate interests that have always had pensions in their crosshairs, the guys who have always wanted to get out from under these legacy costs, in the spirit of never let a good crisis go to waste, are blaming their economic stupidity, their incompetence, on employee benefit plans, the pensions of members, my pension, and the pensions of auto workers, forestry workers and steelworkers. Somehow we are dragging down capitalists with our greed.
All the empirical evidence and all the numbers indicate that if Canadian auto workers worked for nothing, it would only bring down the cost of a car by 5% to 7%, and those pieces of junk could still not be sold because the car companies design cars that nobody wants to buy. They found some way to blame employee benefit plans.
Corporate Canada has wanted to get rid of this for 20 or 30 years. Never let a good crisis go to waste. Here they have an excuse to put the pension plans of workers in their crosshairs and set their sights on them.
The public sector perhaps is the last bastion where reason and logic prevails in terms of employee benefit plans. We are not going to be deterred by this sort of PR campaign by the corporate sector in trying to assign blame to workers for its own failures.
I personally feel if we had more real engineers coming out of our universities instead of financial engineers, we would be in a lot less trouble. They have made the financial market so complex and so incomprehensible that even investors do not really understand derivatives markets and hedge fund markets, et cetera.
A trustee on a public sector pension plan, or a private sector pension plan for that matter, has to keep up to speed with all of the financial engineering grads being pumped out of MBA programs. There is a fiduciary responsibility on the part of trustees of these benefit plans to act always in the best interests of the beneficiaries. Shop floor trustees have that idea in mind. I am not sure the management side trustees have the same goal in mind. They worry more about what they call the legacy costs, the burden on their operation, than about the well-being and the income security of retirees.
In the context of the RCMP Superannuation Act, a lot of these things can and will be addressed when free collective bargaining is introduced into the relationship between the RCMP and the Government of Canada.
I would like to know why the government is appealing the Supreme Court ruling stating that the RCMP should have the right to free collective bargaining. This has been a long time coming. Those who are opposed to the idea would say that we cannot have the RCMP go on strike because of national security. That is a complete red herring. There are many essential services where people do not have the right to strike, but they do have the right to free collective bargaining. It is the only way to achieve a compensation package that is free of interference and that is argued on its merits, not on the imbalance of the power structure between the employer and the employee. We get away from the imbalance in the power structure and we arrive at a fair compensation package.
In the context of that package, I assure the House that the representatives of the employees would want adequate representation, if not equal representation, on their superannuation plan, their pension plan, especially with the shenanigans and the hanky-panky that went on in recent years. There is a bit of a paucity of trust, faith and confidence in their own package.
As I have said, two representatives from Winnipeg Centre paved the way to income security for retirees. Every day I take my seat in the House of Commons, I am very aware of the honour to follow in the footsteps of these two great men, J. S. Woodsworth and Stanley Knowles, both ministers, both men of the cloth. Both believed fully in using their position in Parliament to benefit not only the constituents they represented, but the people of Canada generally. I commend them for choosing income security for seniors as a main priority.
That struggle is not over; it continues. The very modest points in Bill C-18 we agree add some modicum of fairness to the RCMP Superannuation Act. The notion that one could purchase a period of past service for pension service is fair. That is why we can support the idea.
However, as a member of the Standing Committee on Government Operations, where the bill found itself for the committee stage, we heard representation from representatives of the RCMP. I am not making reference to the SSR, which is the official representatives for the purposes of bargaining for the RCMP. I am speaking of an informal group that may wind up being the advocates for RCMP, and that is the Mounted Police Professional Association of Canada. It would certainly seek to be the legally recognized bargaining agent for RCMP.
The courts have given the Government of Canada 18 months to remedy this situation and to allow for free negotiations through collective bargaining. It will have to recognize a bargaining agent. I urge the government to drop its appeal and allow that 18 month period to begin immediately so RCMP officers can have the right to representation of their own choice.
There is no compelling reason whatsoever why RCMP officers should not have the right to free collective bargaining just like the rest of the public service. If their services are deemed essential, then their right to withhold their services can be limited and truncated, but there is no excuse for them not to have free collective bargaining.
I hope the matters we have dealt with today will be dealt with properly at the bargaining table.