Category: Quick updates

PSAC is advocating to roll back changes that the government made to its reporting of federal pension costs because they make the cost of the plan volatile.

Pension accounting decisions can profoundly impact the path that governments take when determining the affordability and viability of workers’ pensions. The accounting changes in question, made in 2018, valued pre-2000 pension liabilities in a way that falsely assumed all these liabilities would have to be paid off that year. In a recent submission to the federal government, PSAC suggests a fair accounting method to better reflect the pension plan’s real cost.

PSAC members are the primary beneficiaries of both the Public Service Pension Plan (PSPP) and of the Public Service Health Care Plan (PSHCP). Combined, these two plans represent the largest proportion of employee pension and other future benefit costs reported by the federal government. As a result they are frequently targeted by fiscal conservatives who constantly clamour for public service spending cuts.

The union’s submission to the Department of Finance argues that pensions are in fact deferred wages that members earn throughout their careers. The pension and benefits that government workers receive when they retire are not a tax-payers’ gift, but rather an earned employment right.  Pensions must be treated as a long-term obligation by the employer, however, the government’s chosen accounting methods  make the pension plan appear more costly than it truly is based on short-term market fluctuations. PSAC is calling on the government to choose valuation and reporting methods that are both transparent and fair.

Your union will always push to ensure that your pension is safe, secure and well-funded.

Read our submission to the federal government here.

PSAC has been one of several unions participating in the Canadian Labour Congress’ Task Force on New Forms of Privatization. On June 25, the Task Force has released its report For the Public Good: The growing threat of privatization and workers’ proposals to protect our future.

The report is the culmination of a thorough analysis of new forms of privatization, in particular social impact bonds (SIBs), pension fund and investor participation in privatized infrastructure, and new federal agencies that motivate and support privatization of services and infrastructure. Which by any measure, should be fully within the public sector in order to serve the public interest. These agencies – The Canada Infrastructure Bank, FinDev Canada, and the Social Finance Fund, along with more traditional forms of privatization, all contribute to the growing instability in public services, at a time when we, more than ever, need a robust public service to ensure competent and effective services for Canadians.

While largely written prior to the COVID19 pandemic, the report does raise the critical role that public services have had in Canada’s response to the crisis. Public sector workers – PSAC members – have been doing this critical work across the country – at the control hub of the response at the Public Health Agency of Canada, in food plants ensuring our food is safe, at our borders and our airports, delivering emergency benefits to workers and to businesses, developing and testing vaccines and treatments.

In some sectors, privatization has resulted in devastating loss of life. We only need to look at the privatized Long-Term Care homes to see the very real, and very tragic results when profit comes before people.

The report outlines a hopeful path forward, bringing public services back in house, and furthering best practices for publicly funded, built and maintained infrastructure that will be critical to not only the recovery from the economic crisis stemming from the COVID19 pandemic, but will also be instrumental in better weathering future crises, whether pandemics, climate change or other.