Labour Minister tackles pension plan deficits

QUEBEC CITY – Quebec’s Labour Minister wants to stop public pension plans from falling deeper into the red.

Cities’ pension deficits now total more than $4 billion.

In 2008, at the height of the recession, economists noted a one per cent variation in interest rates had a 10 to 15 per cent impact on pensions. Now, public pension plans all over Quebec are unsustainable, meaning taxpayers could soon be called on to foot the bill. The situation is so dire Quebec’s Labour Minister is getting involved.

“We are doing a big move, bringing new tools, a new way of doing, to be sure we’ll protect for years to come pension plans of people,” said Agnès Maltais.

The minister told reporters on Thursday she wants parties to negotiate a long-term solution. She suggested in the future, employees share payments 50-50. She created three forums. By next summer, she said if parties can’t agree on the restructuring, she will name a conciliator. If after six months, there is still an impasse, the file will be sent to the Commission des relations de travail. Maltais is setting a two-year deadline.

For the Coalition Avenir Quebec (CAQ), two years is too much.

“Because of all those delays and inaction, what’s going to happen is very clear: there will be, unfortunately, some increases in taxes in municipalities that have those huge deficits,” said CAQ Finance Critic Christian Dubé.

Quebec City Mayor, Régis Labeaume, is also disappointed. He has been asking for more power to rejig collective agreements and impose work conditions to pay off millions in accumulated deficits.

“We don’t understand why the Commission des relations de travail at the end will decide and replace the elected people,” Labeaume said.

Labeaume has found an ally in Montreal Mayor Denis Coderre.

“To wait two years before doing anything and putting up the legislation only in five months, that’s nonsense,” Coderre said.

Maltais said she will table a first bill on pensions next Spring. The mayors are asking she drop the forums and table a new law as soon as parliament reconvenes in February.