As a long-time advocate of fiscal restraint in the public
sector, it is very comforting to see the sobering report by Kevin Page the
Parliamentary Budget Officer. His latest report states that the federal public
sector compensation is approximately $114.000 per employee. This figure which
comprises wages and benefits outpaces inflation and of course the average compensation
in the private sector.
What we must remember is that the reported figure is for
federal employees. We must also look at compensation for provincial and local
government employees to see how much of the taxpayers money is spent on public
sector employees; given that in some cases the wages, salaries and benefits of
public sector employees account for over 60% of operating costs.
In the past years there has been a movement towards the
right-to-work (RTW) in the United States. Last fall Wisconsin saw a very
acrimonious battle between Unions and the State Government. A recall of the
Governor by Unions was soundly defeated at the ballot box.
On December 11, 2012 Michigan became the 24th
State to pass a right-to-work legislation. What is significant is that Michigan
is the bastion of the union movement, the birth place of the Auto Workers
Union, one of the most powerful unions, which also has a foothold in Canada.
Statistics show that unemployment is lower in most of the
states that have adopted RTW policy. Union membership is dwindling in the
United States where the huge settlements made through collective agreements in
the public sector are the main cause of bankruptcies at the local and state
levels. Governments can no longer sustain the costs of promised pensions in a
changing economy.
In Canada, The Rand Formula (1946) which makes trade union
dues mandatory regardless of the worker’s union status has legal force in
certain province. While unions have contributed to the wellbeing of workers in
the past, in the 21st century their role has changed and the results
of collective bargaining, especially in the public sector has clearly become a
burden on the taxpayer.
In addition unions in many cases have not represented their
membership very well. For example the Alberta Teachers Association did not
support Lyndon Dorval in the ‘no zero’ policy. Unions oppose immigration of
foreign workers in an environment of high levels of vacancies and change in demography . They oppose any
privatization of public sector services, and always maintain that any
collective bargaining is ‘not about money’ and yet refuse to open their books.
Despite the fact that Brent Rathgeber Conservative MP
opposes a bill that will force unions to publicly disclose how they spend the
dues collected from members, it is important for this bill to pass and this is why: Unions derived
the majority of their revenues from dues paid by their members. Under the Rand
Formula workers are forced to pay union dues deducted from their wages. Once
collected there are very few limitations as to how this money is spent by the
unions. In many cases they fund political parties or agendas. In the public
sector all wages are paid from taxes collected from Canadians, it therefore
seems that the tax payer is the main provider of funds to Unions. Should we not
have more disclosure on how our money is being spent?
Canada should follow the United States in the sea change in
laws governing unions. At the very least we should amend the Rand Formula to
give workers the right to choose where their dues are being spent, or as in
some cases designate where the money collected should go ( e.g. to charities of
their choice). The right-to- work, without joining a union should be encased
into the Canadian Charter; alternatively those who want to join a union can do
so freely.
Unions have a role to play in the private sector, but no
longer in the public sector, where as a result of their size have become too
powerful and less conciliatory. The cost of their existence has become too
expensive and they have become a deterrent to change required to make the
public sector more efficient. It is time for Canadian taxpayers to demand that
their money is better spent on services and not Unions.
Marcel Latouche
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