Worker Contributions to Pension used Pay off Canada’s Dept
You may have heard the news lately about Pension Theft or a surplus of the Federal Public Service Fund, but what does this mean for workers in Yukon? We will provide you with some information and links and try to break this down for you. The Stop Pension Theft campaign is not just about how a pension surplus is used, but also about who contributed to that fund and who continues to contribute for the next 4 years. It’s also about how this pension fund is paid out upon retirement.
Most workers who have a benefits plan understand that both a worker and employer contribute to a retirement benefit (ie. RRSP, Pension, or Investments), typically with some balance of percentages contributed by both workers and employers. So consider now the lines of communication being put forward in the media on what is happening now to the Federal Public Service Pension Fund:
- workers and government contributed to the fund and it did well (50% contributed from workers pay). Now there is a 1.9 Billion surplus that the government says will be taken to pay off Canada’s debt. This is based on a calculated surplus in 2024.
- unions also found out that the government plans to stop all future contributions to the pension fund for 2025, 2026, 2027 and 2028, while still expecting workers to contribute.
- add to this a 2-tier pension system put in place back in 2012 that treats new hires since 2013 differently than workers hired previously.
This is the pension plan for Government of Canada workers nationwide, workers of Governments of Nunavut, Northwest Territories, Qulliq Energy Corporation, Northwest Territories Power Corporation and for all Yukon Government employees in our territory. This federal decision about the pension fund affects union members of Yukon Employees Union working for YG and Yukon Association of Education Professionals.
PSAC has exposed the government’s decision to suspend its contributions for the next four years while expecting workers to continue to pay their share. This unfair move benefits on the government, undermines trust, and sets a dangerous precedent for all workers in Canada.
Pensions are sacred – they represent deferred wages and the promise of retirement security. Poaching pension funds breaks that promise, putting the retirement security of workers in jeopardy and eroding trust for all workers in Canada.
PSAC has proposed three fair and reasonable solutions to address the pension surplus and restore fairness:
- Reverse the two-tier system introduced by the Harper government in 2012, which unfairly denies newer employees the same benefits as long-term workers.
- Follow through on the government’s commitment to provide equitable retirement options for frontline public safety works.
- If the government gives itself a contribution holiday, workers who equally pay into the pension plan should get one too, ensuring fairness and equity.
CTV News Ottawa shared a clip where PSAC President Sharon DeSousa explained that the government is not just taking the surplus but stopping all contributions to the Pension fund while still expecting workers to contribute off their paychecks.
Canadian Association of Professional Employees (CAPE) favours strengthening the tier two plan to bring it in line with the tier one plan, allowing newer workers to retire earlier without penalty. “Under the tier two pension plan, employees are not entitled to all the same benefits as those covered under the tier one pension plan – those who began contributing by December 31, 2012. This means they must work an additional five years before being eligible to retire compared to those who began contributing earlier under the tier one plan.”
Professional Institute of Public Service (PIPSC) President Jennifer Carr, notes “Federal workers contribute 50% of the money that goes into the pension fund, yet are receiving 0% of this added surplus…Imagine a bank telling a Canadian that, even though their investments did exceptionally well, the bank is going to take the profits.”
PSAC National President Sharon DeSousa says, “This move sets a dangerous precedent for all workers – in public or private industries…stealing from the federal public service pension fund will set an unacceptable standard for all employers.”
What can you do?
The Public Service Alliance of Canada (PSAC) launched a national campaign to stop pension theft and protect workers’ rights. Here’s how you can support the fight:
- Learn more: Understand what’s happening with the pension fund, how it impacts workers, and why it matters to all of us.
- Spread the word: Share this issue with friends, family, and your networks. Together, we can amplify the message and build momentum.
- Stay informed: Follow PSAC for updates on actions you can take to help protect retirement security for all workers.
This fight goes beyond one group of workers. It’s about fairness, accountability, and the future of retirement security for everyone. Let’s stand together and demand better.
Sources for this article are linked.
