Thank you, Mr. Speaker.
The Public Review of Bill 12
The Standing Committee on Government Operations held a public hearing on Bill 12, in Yellowknife, on September 25, 2014. The committee anticipated that there would be some degree of stakeholder interest in Bill 12, owing to the importance placed by most individuals on matters related to their pensions. However, the turnout for the meeting exceeded the committee’s expectations. The committee wishes to thank everyone who attended the public hearing, especially for their forbearance regarding the somewhat crowded committee room.
The chair of the standing committee opened the meeting, followed by opening remarks by the Honourable J. Michael Miltenberger, Minister of Finance, and Mr. John McKee, president/chairman of NEBS. Opening remarks were followed by presentations made by Mr. Mike Aumond, deputy minister, Department of Finance; and Mr. Shawn Maley, chief executive officer, NEBS.
The following individuals were also present as part of the delegations: • Mr. Jamie Koe, director of corporate services,
Department of Finance, GNWT;
• Ms. Kelly McLaughlin, director, legal services,
Department of Justice, GNWT;
• Mr. Carl Bird, director, NEBS; • Mr. Jeff Renaud, director, NEBS; and • Ms. Nicole Pintkowsky, director, program
operations, NEBS.
The committee received oral and written submissions from: • Mr. Dennis Adams, a retired NEBS pensioner
and former CEO of NEBS, writing as a member of the public;
• Mr. James Anderson, a member of the public; • Mr. Jack Bourassa, regional executive vice-
president, north, Public Service Alliance of Canada;
• Ms. Mary Lou Cherwaty, president, Northern
Territories Federation of Labour;
• Mr. Metro Huculak, superintendent, Yellowknife
Education District No. 1;
• Mr. Kevin Hynes, president, International
Association of Fire Fighters, Local 2890;
• Mr. James Infantino, pensions and disability
insurance officer, national programs section, membership programs branch, Public Service Alliance of Canada; and
• Ms. Gayla Meredith, president, and Mr. Dave
Roebuck, executive director, Northwest Territories Teachers’ Association.
Outside of the call for submissions, the committee also received correspondence related to Bill 12 from: • Ms. Sara Brown, chief executive officer, NWT
Association of Communities; and
• Mr. Shawn Maley, chief executive officer,
NEBS.
All submissions received by the committee are appended to this report.
What We Heard
It is clear from the passion with which presenters spoke that pension security is an emotionally- charged subject matter and one that is very important to those who work hard to save towards their retirement. The standing committee found all of the submissions it received to be thoughtful and carefully considered and wishes to thank everyone who took the time to provide a submission on Bill 12. While the comments on Bill 12 were broad-
ranging, the following themes emerged from the submissions:
1. General Support for NEBS Legislation but
Calls for Withdrawal of Bill 12
All of the submissions we received acknowledged the need for and were supportive, in principle, of legislation to govern NEBS. There was no one who expressed the opinion that NEBS should continue to be administered in the absence of a legislative framework.
Despite the support for legislation in some form, the degree of support for Bill 12 varied and all of the submissions raised concerns regarding aspects of the bill that were considered to be problematic.
Of the eight submissions received, one was supportive of Bill 12, but acknowledged those parts of the bill that were likely to be contentious and offered suggestions as to how those areas of concern might be addressed. One was supportive, provided that NEBS remained a “defined-benefits” pension plan. Three submissions called for Bill 12 to be withdrawn, or abandoned in its current form, on the basis that inadequate consultation had taken place with pension holders and called for a meaningful consultation process to be established in place of Bill 12.
Ultimately, after considering all of the input received, the standing committee felt that the withdrawal of Bill 12 would be counterproductive. The committee felt that the key concerns of stakeholders could be addressed with appropriate changes to Bill 12. It is on this basis that committee proposed 12 motions to amend the gill which are discussed in greater detail under the section of the report titled “What We Did.”
2.
Lack of Consultation with Pension Beneficiaries
Going into the public hearing on Bill 12, the committee was concerned that pension beneficiaries had not been adequately consulted during the preparation of Bill 12. This concern was substantiated by several of the presenters, some who confirmed that no consultation was undertaken with the bargaining agents representing pension beneficiaries and some who noted that, as pension-holders, they had received no information or meaningful consultation on the proposed legislation.
When asked specifically about the government’s consultation efforts, Minister Miltenberger spoke about the consultation that took place with the Nunavut government and Mr. Aumond added that the GNWT consulted with the NEBS Board. Mr. Maley described the consultation effort by
NEBS as “extensive,” adding that NEBS made a point of telling beneficiaries what is going on with the development of Bill 12.
The committee was persuaded that Bill 12 was developed in the absence of meaningful consultation with pension beneficiaries. Meaningful consultation depends on those being consulted having adequate information, time to consider it and the ability to have input into decisions before they are made. The committee has no reason to doubt the truth of Mr. Maley’s claim that beneficiaries were provided with information about the legislation as it was being developed. However, merely providing information does not constitute consultation.
In this regard, the committee feels that, ultimately, it is the Minister of Finance as the sponsor of the bill who has a duty to ensure that adequate and appropriate consultation takes place with all stakeholders, including pension beneficiaries. By restricting their consultation efforts to the Government of Nunavut and NEBS Board members and officials, this duty was not met by the Department of Finance.
3. Retroactive Reduction of Accrued Ancillary
Benefits
Clauses 15(1)(a) and (b) of Bill 12 authorize the Pension Committee “at any time, from time to time,” to retroactively reduce accrued ancillary benefits and to reduce core pension benefits on a going-forward basis. Serious concerns were raised regarding this provision because it was seen to be giving the Pension Committee this power under circumstances in which a majority of the Pension Committee members represent employer members of NEBS, not employee pension holders. These concerns were exacerbated by the fact that the definition of what benefits are considered “core” versus “ancillary” is not included in the legislation, but is instead left to be defined in the plan documents.
NEBS representatives responded to this concern by noting that ancillary benefits would be defined narrowly as cost of living indexing benefits and that the Pension Committee has no intention of reducing ancillary benefits accrued before the coming-into-force date of Bill 12.
The committee believes that the representatives of NEBS who appeared before the committee were well-meaning and sincere in their efforts to develop legislation governing the NEBS Pension Plan. The committee has no reason to disbelieve the information they were provided, which included assurances from NEBS representatives that they have no intention of reducing any benefits. These assurances notwithstanding, the committee is aware that the legislation has the potential to long outlast the
current NEBS Board and administration and that, as drafted, Bill 12 provides the authority for the retroactive reduction of accrued ancillary benefits and the future reduction of core benefits not yet accrued.
As a result of the concerns heard, the standing committee moved Motion 6 which, among other things, removes the ability of the NEBS Board or Pension Committee to retroactively reduce any accrued benefits. Motion 6 is discussed in further detail below, as are Motions 8 and 11, which are related to Motion 6.
Mr. Speaker, I would like to pass the reading of the report to my colleague Mr. Dolynny.