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Bill 34 - Employment Pension Plans Amendment Act, 2008

October 21, 2008 - Second Reading

Ms Blakeman: Thank you very much, Mr. Speaker. It was a bit of a surprise to me, but it turned out that I am the Official Opposition critic for Bill 34, Employment Pension Plans Amendment Act, 2008. I’ve spent some time with it, and I’ll do my best to bring a critical eye to this.

Not to repeat too much the Member for Calgary-Nose Hill, where this started, interestingly enough, was that we ended up with pension plans that were crossing over provincial lines. The famous case that sort of in modern times started the kerfuffle, if I may put it that way, was what’s call the Leco case. It was a large trade union that existed in both Ontario and in Quebec, and it wanted to make some changes. Essentially, it was looking to fold, I think. They had an agreement where they decided to roll it up, and that was okay for the Ontario folks. Then the Quebec folks disagreed absolutely. It was a surplus from an Ontario registered pension plan, but it also had a significant number – it was a Leco, L-e-c-o, plan. It also had members in Quebec and some other provinces. The fund had been wound up. There was a decision, a member consent-based surplus withdrawal provision. The Ontario pension commission approved this surplus refund in 1997, but then the refund was challenged by the Quebec members. And then we have duelling pension wars in Ontario and Quebec. They each ended up with rulings and appeals and da da da da.

In the end, essentially Quebec won on that one, and it was ordered that the Quebec portion of the surplus was subject to the surplus arbitration of the Quebec pension legislation. It ended up being a huge mess, and what it really clarified for everybody is that we needed to have a better way of dealing with pension funds that end up crossing over jurisdictional boundaries.

So it was referred to the group that my hon. friend talked about, the Canadian Association of Pension Supervisory Authorities, with a sort of plea: would they please deal with this and come up with a suggestion on how this could have been done better? The effect of that whole back and forth, which took place over – now, it was originally wound up in ’87, and it went back and forth. The surplus refund was ’97. I think this went back and forth for about four years, which is a long time.

What it really did was that it caused all of the pension regulators to be much more cautious in their approach to administration of reciprocal agreements. Therefore, it made it more difficult for employers to administer these multijurisdictional plans because they now had to be more careful. There was increased pressure from industry to provide a solution, so they turned to the Canadian Association of Pension Supervisory Authorities. Now, that group is a national, interjurisdictional association of pension supervisory authorities whose mission or mandate is to facilitate an efficient and effective pension regulatory system in Canada, and it also looks at pension regulatory issues of common interest and develops policies to further simplification and harmonization of pension law across Canada. They put their little heads together and came up with a multilateral agreement. What we had before was basically a reciprocal agreement that existed and, when it got tested in court, clearly didn’t work. Now what we’re moving to on the basis of what the Canadian Association of Pension Supervisory Authorities came up with is a multilateral agreement which is dealing with the issues that are being identified by the regulators and the stakeholders. Our superintendent of pensions in Alberta was involved with the Canadian Association of Pension Supervisory Authorities during the development of this particular agreement.

The second sort of piece of this puzzle is the Employment Pension Plans Act. Now, you know, sometimes there’s serendipity, Mr. Speaker. This afternoon for one of the other bills I spoke on today at one point I said: well, perhaps this other bill doesn’t exist anymore or is not in force or is a shell bill or something like, and if that’s the case, someone will correct me. Then I look, and, no, indeed the bill I was talking about was the Employment Pension Plans Act. Having read everything I can now, I can say that that particular act puts in place protections, safeguards, for employees by setting up minimum standards over things like qualifying for benefits, determining what the benefits would be, funding pensions, investing pension assets, and the disclosures that are required back to the membership. So we have the setup to this. What was the problem? I’ve outlined that. The solution was to come up with a multijurisdictional solution to this, and that’s, in fact, what we’re getting here. The old way was the reciprocal agreements; the new way is the multijurisdictional, multilateral application. Currently what we have is that pension members in more than one jurisdiction can register in the jurisdiction in which the majority of the members are employed, and that jurisdiction then administers the laws, but that’s the piece that didn’t work. So the piece we’re trying to get into place now is to facilitate registration and regulation of multijurisdictional pension plans in the jurisdiction where the majority of members are employed.

Same end product; different way of getting there. Okay. Now, one of the things that I was interested in – and the sponsoring member I’m sure will leap to his feet first thing in Committee of the Whole or in his closing comments in second and tell me which trade unions he consulted with.

Mr. MacDonald: They have millions of dollars in pension funds.

Ms Blakeman: Oh, yeah. The trade unions are our biggest pension holders outside of the big public service pension holders. So which trade unions did the member consult with around this particular proposal? If he would be so kind as to list those for me, I’d be very happy. When I actually look at the act, there are a couple of sort of what I would call housekeeping amendments, where they’re correcting the name of the ministry because it’s been referred to here as the minister of finance, and of course it’s now the Minister of Finance and Enterprise. So they duly go through and change that everywhere it appears in the act. Then they start getting into the definitions of the designated jurisdictions and defining that down as to how that’s going to work, which takes up most of the bill. It ends up with coming into force on the proclamation of it, which is a little fuzzy, to be honest with you. What we’re aiming for here is that if a pension plan is to be registered in another jurisdiction, only the administrative and the day to day funding and investment laws of that jurisdiction will be applied, and the laws of Alberta would apply in all other areas. In essence, we’re creating a hierarchy or a priorization of what’s going to apply to who. It’s a way for us to get around the problems that came up in the Leco example, where there ended up being a fight over who actually had jurisdiction. In this case it tries to lay that out and say: this is where all the rules are going to apply, and this is where only some of them are going to apply. I will admit that pensions are not my area of expertise, but I’m getting there.

At this point I don’t know what to say about whether or not I support this bill. I want to go away and do some more research and spend some more time on this. I’d appreciate getting the information from the sponsoring member on who was consulted of the stakeholders because pension plans are so critical to people that I’m really aware of the onus on me to not make mistakes here and to make sure that this is a reasonable plan that it is supported by the stakeholders, and we haven’t had time to do a stakeholder feedback loop to find out what people are actually saying back to us in the community. You know, I came out of the not-for-profit artistic sector, so I don’t really have a pension plan. You don’t care about that when you’re young and involved in all that fun stuff, but as you start to get older, you realize that you’re either going to have to work a very long time or win a lottery or have some miracle happen, or you’re going to be very poor. That, I think, is the state of affairs for many of my colleagues that I came up through the artistic ranks with. None of us ever earned enough money to have enough to put it aside for pensions. Happily, my acting union equity took that money right off my paycheque. I never even saw it. God bless those unions.

An Hon. Member: Wow.

Ms Blakeman: Well, it’s true. That was the only pension or retirement savings that I had. You don’t make a lot of money as an actor, so there wasn’t a heck of a lot of money in that pot. This is really the sign of how much they’re protecting me: they wouldn’t even give it to me when I went on withdrawal as an actor and I asked to take it and combine it with an RRSP that I was starting. They wouldn’t give it to me. They keep it, and they will continue to administer those funds on my behalf until I hit 65. That’s a good thing, and I appreciate the effort they’ve done there. So there’s a union that’s trying to look after their member even when the membership may be really in need of looking after because they’ve been foolish about what they might have done with it.

Pensions. So many people in Canada today and in Alberta don’t have a pension. Those that do are really counting on it. I am particularly cautious about giving my blessing to something until I am really sure that this is the best deal, because I just don’t want to go on record as saying that this is a great idea and then find out a couple of days later that it wasn’t. I am particularly concerned that, for example, the trade union that protected me has had an opportunity to comment.

At this point I’m going to adjourn debate, and I look forward to getting more information and continuing this particular debate on another day because I think it deserves a lot more careful thought.