What would you think if you saw the premier pull the name of one private industry out of a hat and announce that employees in that field had won a new taxpayer-funded pension plan?
Most would be shocked, but that's what the government decided to do.
Well, they may not have used a hat, but the provincial government recently announced the creation of a new defined-contribution pension plan for employees at private child care facilities across the province. Those who work at privately-run home day cares -will soon receive matched RRSP contributions courtesy of Manitoba taxpayers.
How generous of our benevolent, election-nearing government to take tax dollars from often pension-less employees and turn around and use them to create a pension plan for employees in one specific private industry.
If you happen to work in a private sector workplace that offers a pension, consider yourself lucky.
According to Statistics Canada figures, as of January 2008, only 21.3 per cent of private sector employees in Canada had a workplace pension plan.
Not surprisingly, Stats Can data also shows 83.2 per cent of government employees have pension plans; most of which are the richer, defined-benefit type pension plans.
Regardless, it's not the government's role to hold a lottery and provide the winners with a pension plan for their industry.
The excuse the government communicated for the decision was that child care workers weren't paid well and deserved the assistance. The government also suggested that by helping to pay for the pension plan, it will help recruit child care workers to the industry.
Nothing against the child care industry or child care workers, but how did the government choose them?
What about taxi drivers who work long hours? Small business owners who have to put in endless amounts of overtime? Farmers? Store clerks? Welders? Cabinet-makers? The list could go on and on.
There are countless citizens out there who “deserve more” and there are plenty of industries that are having trouble recruiting employees, but the government’s role is not to step in and throw some cash around.
If the government truly wanted to help taxpayers, it would reduce tax rates across the board so that everyone could keep more of their hard earned income and save it for retirement.
Consider that while employees in Manitoba begin paying provincial income taxes after just $8,134 of income, people in most other western provinces don’t begin paying income taxes until much higher amounts.
B.C., Alberta, Saskatchewan and Ontario taxpayers don’t pay provincial income taxes until they earn $11,000, $16,825, $13,348 and $8,943 respectively. Even the federal government has a higher income tax threshold at $10,382.
What the provincial government needs to realize is that having a reputation for being a high tax province makes it harder for businesses here to attract and retain employees. Think about it, how many people want to pick up and move to a jurisdiction that is known for its high tax rates?
One thing is for certain, the government should not be conducting pension lotteries. It should be helping all taxpayers fund their retirements by leaving more in their pockets in the first place.
Colin Craig,
Prairie Director
