| ESSLUIN iN BIG BUSINESS, INSURANCE COMPANIES BEHIND Massive drive to scuttle pension plan massive, highly - publicized campaign against the Canada Pension Plan has been under way Since federal Health and Welfare Minister Judy La Marsh first presented the outline of the Can- atia Pension Plan. : This campaign by the life in- Surance industry and big busi- hess in general is supposedly “disinterested,’’ and intended only to ‘‘protect the poor work- ingman.’’ One recalls the last time the life insurance compan- ies launched a ‘‘disinterested’’ Campaign. This was about 10 years ago, when the St. Laurent government introduced a bill to raise the maximum pension available under the government annuities branch of the labor department from $100 to $200 a month, As a result of the insurance companies’ pressure, the bill was withdrawn and the annuities maximum is still only $100 a month, making it necessary for most plans to switch over to in- surance companies to obtain pen- Sion plans with benefits of over $100 a month! One of the major arguments of the insurance companies against the Canada Pension Plan is that it is‘unnecessary. _ **Vast and increasing numbers of employees are presently cov- ered by private pension plans... to add the proposed new federal Plan on top of these many thou- Sands of . . . private plans, and to load both of these on top of - .. old age pensions, would... Constitute a triple layer of bene- BAL Sicieeyaeeo SONY oasis CONES. seater (From ‘Canada Pension Plan, Panacea or Pitfall for Canada?’’ by G. N, Calvert and N. G. Kirk- land, managing director and vice- President, respectively, of Alex- ander Services Ltd.) * * * That there are a great many Private pension plans in exist- ‘ence is true, There are about 9,000 such plans in operation in Canada. An additional 4,000 are ®xpected to be established in On- tario alone in the next few Months, as a result of the On- -ario Pension Benefits Act. It is uso true that there are a large Yumber of people covered by ‘hese plans. But it is equally true that only 4 minority of Canadian wage and Salary earners are covered by 9rivate plans, and a much smal- ler minority can expect to re- “eive the full pension promised Under those plans, because of lack of portability. Our estimates, based on the Most recent Dominion Bureau of Statistics figures, indicate that Only about one-third of civilian €mployees in Canada are cover- €d by private pension plans. Of these, about one-half have little °r no portability, and are un- likely to receive the pension Promised by their plans (for al- Most 40 percent of those covered, there is no portability of pen- Sion benefits in the case of Changing jobs; for another 12 Percent, there is no portability before 20 years’ service). ‘Laurence E. Coward, recently- Appointed chairman of the On- ¢ tario Pension Commission, stat- % €d the situation in these words: ‘ “Roughly speaking, under half © employees of Canadian in- dustry are members of pension plans, and half of these will not qualify for the pensions. under their plans,.’’ (Speech to the Mon- treal Board of Trade, June 25, 1963). An earlier comment, in a fed- eral government study, pointed out that: **In future years there may well be many older workers near- ing retirement with little or no pension credits although the same individuals may have par- ticipated in pension plans for many years. Such a situation might undermine public con-, fidence in the present system of voluntary pension plans.’’ (De- partment of Labor; Pension Plans and the Employment of Older Workers, 1957.) * * * Not only do private plans, as presently constituted, deprive a large proportion of those who are covered from receiving the pen- sion to which they are entitled for their service, under the con- cept of pensions as a ‘‘deferred wage’’ (Mr. Coward has noted that the Ontario Pension Bene- fits Act represent ‘‘the final vic- tory of the concept that pensions are deferred pay’’), but they are expensive for the employees who are obliged to contribute a substantial part of their pay (most plans in Canada are contribu- tory), and do not let the employee know what part of the cost he is carrying, except in the few casesi where there is point administra- tion and full disclosure to the union of financial details. As an example, an employee who contributes five percent of his earnings from age 25 till retirement at 65 to a plan which WILL THERE BE A PENSION PLAN TO PROTECT HIM? Not if the insurance companies and big business have their way. They are out to scuttle any national scheme because it interferes with their profits. provides for a pension of two percent of average earnings for each year of service pays (his contributions plus interest at 5} percent) about two-thirds of the total cost of his pension! It is safe to assume, however, that this employee has been told or led to believe that his em- ployer is paying ‘‘at least half’ the cost. - large plans, A current problem in some especially those which are paid entirely by em- ployers; is the reduction of the retirement pension bythe amount of increase in the old age pen- sion. Thus, Consolidated Mining and Smelting (controlled by the CPR) has announced that the pension paid under its plan will be re- duced by $10 a month as a re- sult of the recent increase in the old age pension. The North- ern Electric Company's retire- ment pension has already been reduced by $10 a month, when the pensioner reaches 70, as a result of the 1962 increase inold age pension, and a further cut of $10 could be forthcoming with the latest hike in old age pen- sions. The Quebec government is not expected to announce details of its proposed universal, contribu- tory portable pension plan until early in'1964. In fact, the Que- bec government is waiting to see what happens to the Canada Pen- sion Plan. The adoption of the Canadian Pension Plan and the Quebec Universal Pension Plan will un- doubtedly create problems for existing private plans. Both Miss LaMarsh and Premier Le- sage have emphasized their de- sire to leave private pension plans alone. However, both have indicated that private plans are expected to ‘‘integrate’’ with the public plans, particularly by re- ducing present contributions in line with those that will be re- quired by the public plans. * * + COMMENT Canadians face a dual danger: (1) That the insurance compa- nies will find ways to prevent or postpone indefinitely any intro- duction of a public pension plan; (2) That, failing to do so, they will ‘‘integrate’’ with the public plans in such a way as to pre- serve most of their present pro- fits at the expense of the Cana- dian taxpayer. Canadian military takes 25c of every HE Canadian government’s annual $1,634,000,000 in. military spending takes at least 25 cents out of every tax dollar you pay. That’s a powerful lot of So, Hoy TAX PAYERS “eof f anny” AS — money, and it could go along way toward paying the cost of increas- ed pension, medicare, educa-" tion, and all those necessary ex- penses which hike up your cost of 4, sy > A spending tax dollar living. A closer look at the statistics of this military operation was ta- ken recently by Ben Dworkin, fi- nancial editor of the Ottawa Citi- zen, in a series of articles pub- lished in the Hamilton Spectator. Dworkin discovers that mili- tary spending is more than a question of dollars and cents - it is also ‘*Canada’s biggest busi- ness’’, so big in fact, that atran- sition to peace-time production could create some major econo- mic problems for this country, in his opinion. * * * The war budget ‘‘has the larg- est payroll. It involves the largest investment of any single opera- tion. It has the greatest impact on the economic welfare of the nation—purely as a matter of dollars and cents and discount- ing the importance of the defense role.’’ In the 1962-63 fiscal year, 172,000 Canadians were on the payroll of the defense depart- ment, This included 124,000 in uniform and 48,000 civilians. Total salaries and allowances for this group in one year were about $890,000, 000. Here's a Statistic for the un- employed lines at the Scott Mis- sion in Toronto to consider: last year Canada’s professional sol- diers—enlisted men and officers —gobbled up $11,000,000 in food and wore out $5,000,000 incloth- ing. This doesn’t include the air force or navy. Cities with an acute shortage of sports and recreational facili- ties, or a lack of green-belt park- lands, will take little solace from - the news that last year, construc- tion and the purchase of proper- ties for the army alone cost $29,000,000, while maintenance cost another $12,000,000 an- nually. Upkeep of army equipment from the smallest repair jobs to replacement of heavier, ex- pensive units of warfare, runs to another $7,000,000. Biggest business of all, how- ever, was the Royal Canadian Air Force, which last year cost the Canadian tax payer $712,000,000 to support. + * om “The RCAF has become too important a cog in the wheels of industry to discard—or even seriously cut back,’’ says Dworkin. ‘‘It’s operation has be- come big business in the biggest sort of way.”’ The Ottawa Citizen writer es- timates that direct government spending on equipment and main- tenance, linked to the spending See ARMS COST, pg. 10 November 29, 1963—PACIFIC TRIBUNE—Page 5 ATE MA TaN oes agepesurans SSSR GOI AMNOBE ASA fl BRIAR L