PSAC Pension Fightback Campaign

Update - September 2003

Unions' suspicions confirmed on the use of the surpluses

PSAC case works its way through Discovery phase

The PSAC is one of three groups that have filed lawsuits in the Ontario Superior Court challenging the federal government's arbitrary removal of the surplus in the Public Service Superannuation Plan, the RCMP Superannuation Plan and the Armed Forces Superannuation Plan. Before the lawsuits go to trial, there is a procedure called Examination for Discovery which must take place.

The objective of Discovery is to ensure that all the parties have the opportunity to find out about the existence and content of all documents relevant to the case that any of the parties are submitting.

The first step was the filing of relevant documents by all the parties. To date, the federal government alone has produced several thousand documents. Some of the documents contain financial data related to the plans while others provide information on the government's strategy for dealing with the surplus.

Legislated wage freezes were one of the reasons federal superannuation plans developed surpluses during the 1990s. By 1995, the government was already factoring in $14 billion in surplus as part of their plan to reduce the deficit. The government had discovered that accounting rules allowed it to use the surplus to reduce the size of the stated budget deficit without reducing the balances reported in the Superannuation Accounts.

While workers were paying their full share of contributions, the government was effectively giving itself a contribution holiday. Needless to say, the government didn't share any of these interesting accounting tactics with its unions or workers. Government documents indicate that the government needed to use the surplus to meet its deficit reduction targets ­ a surplus which had grown to about $30 billion by 2000.

Court date still well in the future

The next step in the Discovery Process, the oral examination of witnesses, started in February this year with the examination of the witnesses to Treasury Board's documents. That part of the process will continue into the fall. Then Treasury Board will have take its turn and examine the unions on their documents. At this time, it is difficult to predict how many witnesses will be called or how much time will be required to complete the process.

The actual Trial can't be held until the Examination for Discovery phase has been completed. Once that happens, the Court will schedule a Settlement Conference and assign a trial date. The earliest date the Trial will likely take place is late 2004 or early 2005.

PSAC will issue further updates as the case continues.