Government Operations committee  Typically, the models that tend to work have a board that has members who are appointed, some of them by the unions, some of them by the employer. That might be roughly fifty-fifty. Those board members, in some cases, are experts in pensions and investments. In other cases, they're more representative of the employer or the union.

Government Operations committee  Two plans that have performed very well on a global scale in Ontario would be the Ontario Teachers' Pension Plan and the Healthcare of Ontario Pension Plan. Actually, both of those plans, according to independent studies, have had the best returns virtually in the world over the past 10 years.

Government Operations committee  I don't have detailed familiarity with what went on in recent negotiations. I know that a variety of potential reforms were tabled, both in the context of that collective bargaining and other negotiations with the other unions. Part of the challenge is that collective bargaining is a difficult place to resolve those kinds of issues.

Government Operations committee  Yes, by Dr. Robert Brown.

Government Operations committee  You're asking about converting to defined contribution?

Government Operations committee  Not all defined contribution or defined benefit plans are created equal, but I think it can be possible to have quite good defined contribution plans. We've seen that in countries like Australia and the U.K. that have set up public defined contribution plans. Saskatchewan has a public DC plan as well.

Government Operations committee  I think that should be one of the options on the table as part of a structured process. If you look across the country, you see that this practice of pooling public sector assets together to achieve efficiencies of scale is fairly common. It's used in B.C. and Alberta, in Quebec with La Caisse, and federally with PSP Investments.

Government Operations committee  I do think it could be a sound policy move to have an exemption for solvency payments, provided certain changes are made to the plan. There are various different views within the pension community on this issue. Some provinces, such as Quebec, have exempted single employer pension plans from solvency payments.

Government Operations committee  The main change I'm suggesting is moving from a single employer-sponsored plan, with the plan sponsored only by the employer, to one that's sponsored together and governed together with the union. That's the approach that has been adopted by many public sector plans in Ontario, such as the Ontario Teachers' Pension Plan, or the Healthcare of Ontario Pension Plan.

Government Operations committee  What I'm suggesting to the committee is looking at this on the basis of the evidence. What is the most financially sustainable approach and what does produce the most retirement security for the dollar? The answer to that question is often a bit counterintuitive. You hear a lot of debate in the media about how the DC is more efficient, but in a situation like this, where you have an existing defined benefit plan, making that shift can be very expensive.

Government Operations committee  The evidence sometimes suggests the opposite. It can be the opposite because you still have the liability from the plan that you've been running over the years, and in producing retirement security, the new plan that you're setting up can be less efficient for every dollar you put in.

Government Operations committee  It depends on how you measure the cost. I would urge the committee members to look at that paper done by Dr. Robert Brown, because it is probably the best recent example of work done by an expert in this area.

Government Operations committee  I think the best approach for looking at funding rules for pension plans is the governing structure of those plans and how they are overseen. When the Ontario Expert Commission on Pensions wrote its report in 2008, it recommended that jointly sponsored plans be exempted from solvency payments, not because they were in the public sector or the private sector, but because they had a superior governing structure that allowed for better risk management and oversight.

Government Operations committee  There are a couple of different questions there. I'll try to address them both. The first was around what is the financial state of the plan. Part of that debate, which I think you have been hearing at the committee, is around whether the pension should have to make solvency payments, because pensions are funded in two different ways.

Government Operations committee  Thank you, Mr. Chair, and good morning. Thank you for inviting me. My name is Alex Mazer. I am a founding partner of a company called Common Wealth. Common Wealth is focused on expanding access to pensions, working with labour unions, governments, and some of Canada's leading pension plans.