The Canadian Taxpayers Federation (CTF) released new data today just in time for Labour Day showing the large gap between government workers’ pension benefits and everyone else. The CTF again called on governments to freeze and convert their unsustainable defined-benefit pension plans to less costly, defined contribution plans.
Nation-wide, Statistics Canada data shows that 87.1% of government employees have workplace pensions, up from 75.5% in 1977. Outside of government, just 24.4% of workers have workplace pension plans, down from 35.2% in 1977.
Workplace Pensions – Who Has Them in Sasktachewan? (2010)
| Government Employees | Everyone Else |
Defined Benefit | 65.4% | 9.9% |
Defined Contribution | 35.2% | 13.0% |
Other | 0% | 2.6% |
No Pension Plan | 0% | 74.5% |
Source: Statistics Canada (CTF custom order of most recent data.)
Totals may not add up to 100% due to rounding
“Government employees are not only more likely to have workplace pensions, they typically have defined benefit plans - the best type out there,” said CTF Prairie Director Colin Craig. “Instead of raising taxes to pay for expensive, golden employee pension plans, it’s time for governments to stop the bleeding by putting new hires into less expensive plans.”
Craig noted that former NDP Premier Allan Blakeney deserves credit for converting many provincial government defined-benefit plans to defined-contribution plans back in 1977; helping to save taxpayers billions. However, defined-benefit plans like the City of Regina’s employee plan still need conversion; it has liabilities of $293 million and counting.
The average government employee in Canada saw $8,734 go into their pension plan last year while everyone else saw an average of just $4,092 go into their pension plan or RRSP.
Whose Plans Received the Most Contributions in 2011?
| Total Deposits by Employer & Employees* | Number of Employees | Per Employee Contribution |
Government Employees | $31.3 Billion | 3,587,800 | $8,734.18 |
Private Sector Employees | $56.2 Billion | 13,740,800 | $4,091.74 |
* Note: Deposits for the private sector include total nation-wide RRSP contributions (estimated $33.3 billion based on average of last five years) Source: Statistics Canada
“Government employees are seeing twice as much go into their pensions as everyone else and yet their plans are demanding even more tax dollars,” added Craig. “That’s not right. After scaling back their own plans, politicians across the country need to bring government employee plans back down to earth.”
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