NDP leadership candidate Theresa Oswald’s pension idea is poorly thought out. But the question is – will her party’s delegates realize it?

The NDP is reeling in public opinion polls largely due to the unpopular decision to break an election promise and raise the provincial sales tax without voter approval. Despite that reality, Ms. Oswald recently proposed an even larger tax increase.

If elected leader, Theresa Oswald has said she would like to follow Ontario’s lead and implement a new provincial pension plan for those who don’t have a workplace plan. The Ontario government has proposed requiring people to fork over approximately “1.9 per cent” of their income each year to the government to pay for the plan (note: the calculation isn’t quite that straightforward).

So if you make $45,000 per year, the government would end up taking an extra $788 from your pocket. If you have a spouse that makes the same, you’ll be looking at an extra $1,576 per year as a family. Clearly we’re not talking about pocket change.

But it’s not just individuals who will be hit hard. Businesses will have to match each employee’s contribution. If you’re required to pay $788, your employer will also have to kick in $788. You can see why Ontario businesses are concerned about some of the huge costs they’ll face. For many, the added cost will make it harder to compete with competitors located in jurisdictions that don’t have such a financial headache.

Now comes the scary point.

Think about the provincial government and its most basic responsibilities – health care, education, helping people through social assistance and child welfare agencies to name a few.

Despite all the extra money the NDP has poured into the system over the years, our students still tend to do poorly on international tests, our health care waiting times are too long and many rural hospitals are on skeleton staffing levels too frequently. Our social welfare system had no idea high income earners were living in government-subsidized units (incredibly the government has yet to kick them out) and too many foster kids die while under the government’s care.

The results… well, they aren’t too pretty. With so many basic services in disarray can you really trust the provincial government to take on another major project? Something it has no experience with – a complicated pension fund.

If you’re optimistic about the government’s chances, recall the last time the NDP government was involved with an investment scheme – the Crocus Investment Fund. Just prior to the $150 million fund’s collapse, bureaucrats were busy warning senior officials behind the scenes that the fund was about to go under. Incredibly, the politicians kept on encouraging the public to keep investing. Many families lost small fortunes in the debacle.

Given the enormous cost of Ms. Oswald’s plan, and her party’s failure to deliver the services it currently provides in an adequate manner, it’s clear her plan wasn’t thought out too well. Time will tell what her party’s delegates think of the idea.