Views: What Is Happening with Teachers’ Pensions? —
In conversations with teachers during this election campaign a question that keeps coming up is what the government is up to with our pension plans.
Since 2016, Ontario’s Auditor General Bonnie Lysyk, an officer of the Legislature, has been raising the alarm about the government’s accounting practices. In her pre-election review of its financial projections she noted that the government is forecasting revenues from the Ontario Teachers’ Pension Plan and insufficient pension expense for the Ontario Public Service Employees’ Union Pension Plan. Our pension funds however are not a government asset. They belong to us. According to Lysyk the pensions are not a “true asset” because the government does not have the unilateral legal right to withdraw funds from the plans or reduce future minimum contributions to the plans without the express agreement of the plans’ joint sponsors.
The sponsors of the Ontario Teachers’ Pension Plan are the Ontario Teachers’ Federation (OTF) and the Ontario government. Each appoint five members to the plan’s Board and together, they select the chair. Each Board member is appointed for a two-year term and can serve for up to four consecutive terms.
The OTF is overseen by a Board of Governors made up of 10 representatives of each of the provincial teachers’ unions in Ontario: Association des enseignantes et des enseignants franco-ontariens, Elementary Teachers’ Federation of Ontario, Ontario English Catholic Teachers’ Association and the Ontario Secondary School Teachers’ Federation.
The government is forecasting that it will receive $3.4 billion in revenues from the Ontario Teachers’ Pension Plan over the three-year period ending March 31, 2021. However, what it labels “revenues” are not the government’s to use. They belong to the pension fund. The auditor general speaks of the government’s accounting method distorting the forecasted resources available for its decision-makers to allocate in their fiscal planning. It also distorts the fact that the government appears to be unilaterally taking possession of our pension funds.
Lysyk goes on to note that after adjusting for the overstatement of revenue from the teachers’ pension plan and the understatement of expenses for the Ontario Public Service Pension Plan, Ontario’s annual deficit would be $11.7 billion for 2018/19 (or 75 per cent more than the reported $6.7 billion), $12.2 billion for 2019/20 (or 85 per cent more than the reported $6.6 billion) and $12.5 billion for 2020/21 (or 92 per cent more than the reported $6.5 billion).
The government is padding its books with pension funds, which is not acceptable. Those funds are not the government’s to do with as it pleases. They belong to us the teachers. The government should not withdraw funds from our pensions or reduce its contributions to the fund without negotiating with our representatives. The auditor general has repeatedly asked that the government produce proof that it has the consent of the various public sector pension plan boards, on which it also sits, to account for claiming the funds as an asset under its control. No such proof has been provided.
Security in retirement is a right. The value teachers and other public sector workers produce is immense. A portion of the value produced by those actively working must be allocated towards ensuring that in retirement we can live at a Canadian standard of living and not in poverty. For governments to seize this value to pay the rich is unacceptable.
Whatever is going on, neither the current government nor any future one has our consent to take control of our pension funds. It is a serious matter that deserves everyone’s attention, as the silence from the main contenders for political power — one of whom will inherit the situation — suggests that something unsavory is afoot.