C-27: An attack on pensionsJanuary 23, 2017
Even as it adopted measures to enhance Canada Pension Plan benefits, the federal government tabled a bill that will ultimately undermine the security of workers’ pensions.
Bill C-27 opens the way for federally regulated employers to back away from their commitments to employees concerning the security of their defined benefit pension plans. According to the Canadian Labour Congress, “Bill C-27 removes employers’ legal requirements to fund plan benefits, which means that benefits could be reduced going forward or even retroactively. Even people already retired could find their existing benefits affected, after paying in their entire working lives.”
C-27 would permit the conversion of defined benefit plans into target benefit plans, which are less generous and not as secure. Defined benefit plans provide predictable incomes to pensioners, and employers are required to fund them. In contrast, target benefit plans offer benefits that are not guaranteed and that can be reduced if plan investment targets are not reached.
For the moment, C-27 concerns only the workplace pension plans of federally regulated employers, but its passage would set a powerful precedent that makes it more likely that plans in the federal public sector in turn be targeted.
CAPE is currently represented on the Ottawa Committee for Pension Security which is working to build local opposition to Bill C-27 and support the efforts of the Canadian Labour Congress and other organizations. Stay tuned for further updates.
You can voice right now your opposition to this measure by signing the online petition on the Parliament of Canada website.
For more information on this subject, visit the following sites: