From the Hill: The importance of pensions
By Dick Cannings MP
The New Year is a time to look ahead and plan for the future. My wife and I have been talking about pensions lately. She’s debating whether to start her Canada Pension Plan payments. We were self-employed for much of our careers, so she doesn’t have a company pension to draw on, but we have tried to build up our RRSPs over the years.
Pensions are important to all of us. Canadian seniors shouldn’t have to live in poverty after working hard all their lives. But even after recent modest increases to Old Age Security and announced changes to the CPP, many seniors have barely enough to survive each month.
Those Canadians who have had good jobs with pensions are more fortunate—or so they hope. However, we often hear of big companies that fail, and after bankruptcy payouts are made to banks, creditors and shareholders, there is often nothing left for employees and pensioners who were guaranteed benefits when they retired. These pensions are not a gift from employers; they are deferred wages that were bargained for, the workers often giving up wage increases to guarantee themselves a dignified retirement.
The law could easily be changed to correct this, and my NDP colleague Scott Duvall from Hamilton has proposed to do just that. In November he introduced Bill C-384, which if passed would fix our bankruptcy laws to stop corporations from putting shareholders, banks and creditors ahead of their employees and pensioners when they file for bankruptcy protection. Canadian pension laws lag far behind European countries and the USA. There is no reason for Canadian workers to lose the pensions they’ve paid into their whole careers, and this NDP proposal is one way that we can protect those pensions so that they are there when we need them.
In the recent Sears bankruptcy, thousands of employees and retirees face an uncertain future. They were lucky in that their pension funds were held separately from other company assets, but like many Canadian companies, Sears hasn’t been putting enough money in those accounts to ensure full pension benefits. So, pensioners are losing medical benefits that they fought for over the years, and laid-off employees might only get 70 per cent of what they were promised in pensions. The big bonuses Sears executives received during bankruptcy proceedings only added salt to these wounds.
Canadian veterans are also fighting a long battle for fair pensions. The previous Conservative government made major changes to veterans’ pensions that had disastrous effects. So, during the last election campaign, the Liberals promised to fix this, promising to bring back lifetime pensions for disabled veterans. But a Dec. 20 announcement from the Veterans Affairs Minister outlines a plan that falls well short of that promise.
Under the Liberal plan, injured veterans would have to wait almost two more years to receive any “new” benefits. The plan itself replaces and repackages existing awards and it is unclear at this point if there is any new money for disabled veterans.
Mark Campbell, a disabled veteran who lost both of his legs in Afghanistan, was quoted in the Canadian Press and sums up the confusing plan this way: “So we still have this ludicrous situation where you can have two guys with the same injuries from the same war but at different times and getting different compensation… That’s fundamentally wrong, and it has not been addressed.”
If you would like to get in touch with me, please email richard.cannings@parl.gc.ca.
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