Public service pension shortfall tops $65 billion: C.D. Howe

The simple answer is yes. However, you will get those who work for the government say that their pay is lower than the private sector and that the pension benefits offset their lower wage. I have a brother who has been working for the Government for 36 years for the Community Living department. He loves his job and makes $44 000 per year. That's $22 per hour. I don't call that extravagant for a Manager. He could make more per hour elsewhere but the pension kept him there. It balances out.
I like the idea of starting fresh with new hires. They also contribute into a defined contribution pension plan. If they don't like these terms, they don't have to work for the government. The battle will be with the Unions who don't want this even if it makes common sense. They will ask for more pay if the pension does change. JUST SAY NO.

Starting with new employees is a good idea but they will need to ensure it stays that way.
It wont do any good if they just keep adding more promises everytime they negotiate. Public service "threats" seem to be the norm of the public service employees at each negotiation and our government always seem to cave to the pressure. Who are these people who recommend increases for public servants based on private sector? ( the arbitrators) They must be the same people who think everyone in Alberta makes over six figures a year. lol My wages have gone down in the last 3 years and yet they keep talking about private sectors getting raisies the government needs to, at a minimum, match. Where are these increases as no one I know has gotten anything for the last 3 years?
In they type or work I do the public sector pay exceeds the private. I know this is not the case with all, but to say public servants are paid below private sectors rates is just not ture in all cases.

It makes sense to "make the new hires pay" After all they won't be getting a pension, their taxes will be higher, they will have to pay way more to put their kids through university than the people getting a full gov't pension now. Besides, relative to the future for young people now the soon to be retiring government workers won't have really known hard times, why introduce it now? They haven't had to go through long layoffs, forced unpaid career changes and evaporating pensions. To do so now would be a shock, let the people who have already learned what that's like experience it again and punish the young people for not being born in the 1940's & 1950's. After all what are they going to do, go on a taxpayers strike? BWHAHAHAH

Worked Public sector for 8 years before retiring. Retired benefits are amazing including "bridging" to cover me until I qaulify for OAS at 65. Not complaining but I was agahst at the generousity of the plan compared to my private sector plan

I paid $100 per week for my government pension. Since 1980 the DJIA has gone from 800 to 12000. That $100 per week is now over $800000. My employer matched my contribution; that's $1600000. What shortfall?

New Hires? Let's be serious...nobody coming out of university, college or trade school is willing to work for the wages and benefits offered by the Federal Government. I work for the government and I was at a conference two years ago where they discussed "fast-track" staffing which would put young professionals into positions far quicker. I asked how they intended to do this...they told me the wage, told me the hours, and the benefits being offered to these new post graduates...then I laughed at them. If the government plans on hiring the best people, they need to get in the game. The post graduate today that are offered "pension, benefits, and the standard wage" if they are the top of the class...are offered double by the private corporations who walk in behind our staffing officers. Even doctors are not interested in earning just a wage, they want to be able to have a personal life, not be stuck in a rural setting and be able to take time for themselves during the week...they won't work for the government unless it is a simple contract appointment with lots of opportunity to advance to private practice. Wake up Canadian Taxpayer! The government jobs and salaries are far less glamorous than they appear!

I work in the federal government, and have been paying a hefty amount into my pension plan for years. It's not like we're being 'given' this, we are seeing it come out of our paychecks every two weeks - and it's a hefty amount too. I'm not complaining, it's great that it's like forced savings.

Regarding the pension it is a great deal for the taxpayer. Life expectancy of military and RCMP members after retirment is far lower than others and actually saves the pension money when compared to other plans. If those in these sectors are required to work beyond the 30 - 35 years in their profession the only winner is the pension fund and what to do with the windfall.

Of course the public sector employees should contribute more for their own pensions. As for the notion that they are paid less than the private sector is no longer true. One in ten Canadians is paid by the tax payer now at an average salary of $80,000. The nine people paying him are averaging just over $40,000. The one government soul retires with a cola clause pension almost always before age 60 while the nine others need to continue to work until they fall over. Until about 15 years ago you went into public service assuming a slightly lower pay rate but the security and benefits were the carrot. Now they are the highest paid and still can never lose their job....there have been hundreds of thousands of job losses over the past several years but has a single teacher, cop, fireman or any municipal, provincial or federal employee lost theirs? Not one. This is unsustainable but the only unions left in this country with any teeth are the public ones and politicians are terrified of them. Public unions, why? Because they are over worked and under paid? Quite the opposite.

Let me understand this....public sector workers get job security, good wages, 35 hours a week generous benefits and a guaranteed pension that is funded by the rest of suckers like me. It's time some equity was brought into the system. A law should be passed that limits what public workers get paid as compared to what is paid to the private sector.If any public sector worker thinks they are getting paid less than private sector go out and try and get a job then. Don't forget to factor in the benefits hours of work etc. I am tired of paying!!!

@ Jack Schmidt

I realize that saying that "Not one" job has been lost in any level of government sound good in your rant, but its not true. I worked for years in the Ontario Goverment - In the mid 1990's Harris handed out pink slips like candy. SOme offices lost 30-50% of the their staff. More lay-offs in ~2005-2006 with the tranfer to "Service Ontario". I seem to recall a few years back, the BC government laid off thousands as well (I don't recall the details, as I have never worked there). Federal Government chopped al lot of positions back in the Mid-late 90s as well.

So did the job losses happen within the last two years? No. But to say that it has never happened is simply not true. Get your story straight before getting on your soapbox.

Seems to me that lots of folks who are up in arms about government DB pension plans aren't really against them in principle -they just wish they could have them too. Sounds a bit like sour grapes to me... Government jobs open up all the time - if you want one - apply for it already!n Just remeber - like some of the other posters have pointed out - they aren't handed to us for free. In Ontario, you have to work to a Factor 90 to get un-reduced pension, and believe me - we pay for it on every paycheck. An because of the recession, the rates we pay for it have gone up and will continue to go up in the coming years as well. In the past ~10 years, wage increases have been at or below inflation, so our "real" paychecks are going down. If the Ontario government gets its way, outright wage freezes are in our near future as well. So the supposed gravy train really isn't all that its cracked up to be...

I have read the pension info and also some of the replies,it seems to me that all those whining about government pensions being to high are just a bunch of business people who do not pay there fair share of taxes they also do not pay their employees a good wage so that the can have a desent pension, the howe institute is a joke funded buy business to sprout a bunce of garbage,case in point is all the big business that have left their employees in the lurch when they go broke,due to poor management by a bunck of gready CEOs. I dont hear the howe institute saying word one when some company looses billions of dollars and the company management get a big fat bonus for a job well done.

Something has to change you can not possibly have the private sector paying huge pensions and benefits by the private sector who are often working for far less money than the public sector especially when you consider people working for minimum wage or just above and probably no chance of a pension for themselves . they cannot even save enough to retire with any comfort.It would make more sense to increase the CPP contributions and guaranty all canadiens a decent standard of living when the retire instead of only those who work in the public sector.

Most folks don't realize that the contributions by the employee are used up first in the gov't plans. If you work for gov't for 30 years, you have accumulated a considerable amount. They are giving you back the money you put in until it runs out. 30 years worth + interest goes a long way! It is not until your $$$ run out that the gov't starts paying, all you have to do is live long enough! If you and your spouse don't live another 10 or so years after retirement, the government wins! They don't refund the un-used pension money to your estate. The only benefit is that the retiree is guaranteed a pension for life.

Public Service Workers contribute to their own pensions, such as one of the posters above noted - and they pay big money into the plan. I would expect that in the next few years, they will be asked to pay increasingly more.

The CD Howe Institute is a fear mongering, anti labour organization that serves the interests of big business. Do you understand what would have to happen for that so called 65 Billion dollar debt to have to be paid off? ONLY if the Canadian Federal Government went BANKRUPT!! We are not a developing country, so the likelihood of that happening is pratically zero.

Instead of lobbying for federal government pensions to be reduced, we should all be lobbying for everyone elses pension benefits to be increased to that level!.

Hagar ... they do pay to your estate if you die prematurely and survivors (including same gender now) get 60% of benefit foir for life. So unless two 60-year-olds die in a car crash together, the family can expect to see a pension for years. a big benefit for people who are long lived.

1. Government pensions are 70% of your best 5 years.
2. google cdn government sunshine list it will show you how many people in the government make over 100000+ per years, more than you can imagine.
3. government workers get more sick days than you can imagine and can cary them forward.
4. they can get up to 8 weeks holidays per year
5. my many friends that work in the government say its a joke how hard they work. If they work to hard they are told to slow down, the drinking lunches they say are crazy.(check the local pubs on a friday and ask for a show of hands who works for the government. even thursdays are npreaty good.)
6. you cant get fired from your job because the unions back you up. it must be very severe if you are fired. (I have a family member who worked as a union rep and said it was rediculas the people he hade to save there jobs for.)
7. almost guarateed a raise of 3% every year
8. Unions create a non competitive workplace where you will never have to prove yourself to get raises or promotions, everything is just given to you with a pat on the back whether you deserve it or not. It can take a talented young person and slowly turn them into a slacker who does not strive to better themself or the workplace.
9. there is a reason why private companys send there work abroad and a big part of it is unions! they just cost to much. they keep asking for more more more (I do undestand why they do this its only natural but it doesnt work and eventually they need to get back to reality.)
10. every private sector person who reads this (and non union), ask yourself if this is your workplace 99.9% guaranteed no!. the only winey reply's i will get from this are the people who work for the unions at which I say good for you you are very fortunate and be thankful for your position.
11. I do not begrudge people who work for unions especially government. Just stating the obvious.remember tax payers pay 2thirds of you fat pension and all of your wages!

I know this is essentially irrelevant, but isn't there only like 34 million people in Canada? Where are the 80 million baby boomers coming from?

Posted by: tom | Nov 25, 2021 6:30:34 AM

I paid $100 per week for my government pension. Since 1980 the DJIA has gone from 800 to 12000. That $100 per week is now over $800000. My employer matched my contribution; that's $1600000. What shortfall?

Clearly, you don't understand how the system works! Not ONE penny of gov't money is spent UNTIL your contributions are exausted. When you put your dollar in on payday, the government DIDN'T match it with their dollar. Their portion of the contribution doesn't start until your contributions are used up. The only way that you can get 'their' contribution early is to quit your job and get a payout. The money will go in to a 'locked in' plan. You need to live about 10 years after retirement to collect any of 'their' money unless you quit. Folks both in and out of government need to do their research before they go spouting off!

Lets see - CD Howe right wing think tank. So I am not surprised at their comments. It is not that government pensions are too high it is that the private sector pensions are too low and too insecure.

Defined benefit pensions allow for planning while defined contribution pensions are an ongoing gamble that can change from year to year. Friends of mine who had these sort of pensions suffered a great deal during the depths of the present recession. My defined contribution pension just kept sending me my normal monthly payment. I had to pay for my pension. 11% of my gross income. I was not happy about this when I was young but I am now grateful in my retirement.

Our real problem is the present economic system that is still grossly unregulated and as a result unstable. Pensions are a good thing. Our present unregulated economic system that concentrates wealth in the hands of a few people is the problem that has to be fixed.