April 2, 2015
When grassrootsguelph published the names of employees earning more than $100,000 in 2014, it created a firestorm of surprise and indignation. It was exposure that the established media did not publish. Would it clog up the newshole, bubeleh?
What the list did not include were the non-taxable benefits to which each employee is entitled. That includes every job from the Chief Administrative Officer to the worker directing traffic at the Waste Management Innovation Centre on Dunlop Drive..
The non-taxable benefits include defined pensions, post retirement health and spousal plans, and accumulated unused sick leave and vacation allowances.
The activist organization, Fair Pensions For All (FPFA), has been warning Ontario municipalities about the danger of the Ontario Municipal Employment Retirement System (OMERS) having a $7.3 billion shortfall funding its obligations.
There are 263,000 Ontario public employees who are members of OMERS. In Guelph there are more than 2,100 full-time equivalent employees in 2014 whose pensions are managed by OMERS. Of that number, some 266 made more than $100,000 last year.
These numbers do not include the University of Guelph or Guelph Hydro. But those public employees are supported by taxpayer dollars, including their defined pensions. The University pension plan is underfunded. In the defined pension plan system the employer pays half the cost of each employee to OMERS while the employee pays the other half. Recently it was reported that OMERS was increasing the employee’s share to help reduce its plan’s deficit.
Seems fair on the surface but for that huge deficit that OMERS is running. If the pension system fails to meet its long-term obligations, then it will turn to the municipalities to make up the shortfall.
That’s you and me. According the FPFA, Guelph’s share of that shortfall pension obligation will rise from $41.7 million to $51.5 million by the end of 2015. That increase is pretty close to what the Urbacon lawsuit cost the city in 2014. But a single motion to reduce the repayment funds from $900,000 to $500,000 in 2015 was supported by the majority of council. The mover was Coun. Karl Wettstein whose idea of having an original thought is ordering lunch.
If they fail that test of fiduciary responsibility, how can you expect them to take the necessary steps to curtail the exploding growth of taxpayer-funded pension obligations?
The blogosphere was percolating this week with claims that the OMERS deficit will be straightened out within 10 to 15 years. Further, a blogger stated that OMERS was earning 6.5 per cent on its investments as the basis of such a claim.
Show us a financial advisor who will consistently guarantees that kind of investment return, and I’ll show you Merlin the magician.
The only way to arrest this pension pickle is to stop hiring, freeze salaries and trim employee perks and benefits. It’s an ugly job but somebody has to do it. That’s about as right-wing as that great socialist premier, Bob Rae. He cut staff costs by forcing them to take a day off without pay. Remember Ray Days?
As the previous administration failed to acknowledge this serious problem, it is astonishing that this $480 million corporation doesn’t have a Chief Financial Officer. The previous occupant of the position was shifted to become a Deputy Chief Administrative Officer with different responsibilities.
In the last campaign and ongoing today, the Farbridge team painted anyone with a different point of view as right wing conservatives. Well, the majority of citizens voted for change and change they got.
Or so we thought. How can you explain that on March 5, the city staff recommended a 2015-operating budget containing a 3.05 per cent increase in property taxes? Only citizens discovered on March 25, the majority of council, after public input meetings, approved the tax increase of 3.55 per cent. This passed without public input.
The more things change, things remain the same.
Will those people wanting to keep their heads in the sand please form a line on the left.