Juno News - October 01, 2021


Private sector has to deal with pay cuts. Why doesn't the public sector？


Episode Stats


Length

11 minutes

Words per minute

188.18451

Word count

2,165

Sentence count

135

Harmful content

Misogyny

1

sentences flagged


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

In the wake of the Pandemic, many businesses across the country have been forced to cut back on compensation. But no government has done the same. Why not? We talk to CTF President Colin Craig to find out why.

Transcript

Transcript generated with Whisper (turbo).
Misogyny classifications generated with MilaNLProc/bert-base-uncased-ear-misogyny .
00:00:00.000 I want to talk about a new report from our friends over at secondstreet.org.
00:00:10.840 COVID has led to pay cuts in business, but no government has cut pay.
00:00:15.740 Colin Craig is the president and joins me now.
00:00:18.380 Colin, good to talk to you. Thanks for coming on, as always.
00:00:21.380 Well, thanks for having me, Andrew.
00:00:23.160 So explain this. We've seen for the last year and a half,
00:00:26.180 businesses that have been forced by government fiat to shut down,
00:00:30.000 we've had a lot of insecurity in the private sector on jobs,
00:00:33.540 yet none of that insecurity and uncertainty has made its way to the public sector.
00:00:39.020 Yeah, that's basically it.
00:00:40.660 As the pandemic emerged, we saw all these news stories about various businesses
00:00:44.420 and many industries struggling and having no choice but to cut back on compensation.
00:00:50.080 Everything from Chrysler in the automotive sector to oil and gas companies
00:00:55.820 to entertainment companies like Cineplex, CFL teams,
00:00:59.580 there were so many different stories.
00:01:00.960 We thought, well, wait a second, there's one sector here that's missing and that's the government.
00:01:05.640 And so it got us thinking, when was the last time that governments actually cut employee pay?
00:01:10.140 And so we filed these requests right across the country to ask that question.
00:01:13.160 I know that we haven't yet seen the totality of the financial toll that COVID has taken.
00:01:20.800 And I include in that not just the pandemic itself, but also the lockdowns and restrictions and whatnot.
00:01:26.240 But one thing that we know is that the private sector has to be responsive to the market.
00:01:30.400 If your business goes down, you don't have enough money to keep your staff and you don't need as many staff.
00:01:35.140 In the case of government, we know from all of these business losses that the tax base had to shrink,
00:01:40.300 at least in some way.
00:01:41.700 But that same responsiveness to revenue, to inflow, isn't there with government.
00:01:47.280 No, it's not.
00:01:48.340 Because governments just look at your kids and mine. 0.55
00:01:51.180 They just rack up tons and tons of debt rather than saying,
00:01:55.040 hey, wait a second, you know, we got to curtail spending a bit.
00:01:57.940 I don't think too many Canadians would say the government shouldn't have done anything in terms of relief in that.
00:02:03.260 I think most people would agree that that was necessary.
00:02:06.220 But just the overall largesse, there was no restraint on the government's part.
00:02:10.820 So you had lots of people in the private sector taking pay reductions.
00:02:14.900 And as our research found, really nothing in government.
00:02:19.480 You know, the federal government told us that they don't have any records of ever cutting employee pay.
00:02:24.800 Never mind during the pandemic.
00:02:26.840 Never at all.
00:02:27.820 That's what they told us.
00:02:28.840 Or if it did happen, it went so far back that everyone's forgotten and no one has any record of it.
00:02:34.760 Provincially, pretty much across the country, provinces had no records on any kind of pay reductions.
00:02:41.700 The last pay reduction seemed to have happened in the 1990s.
00:02:45.360 Which, you know, if you think about that, that's over 20 years ago now,
00:02:48.360 since there's been any real wage restraint in government at the provincial level.
00:02:53.320 Well, the one example that we did find was Manitoba, where employees were required to take five unpaid days off.
00:03:00.660 Which isn't the same as a pay cut.
00:03:02.480 Because with a pay cut, you still do the same amount of work.
00:03:05.120 You just make less doing it.
00:03:07.360 So that was one example provincially.
00:03:09.020 And then at the city level, we saw that in Mississauga, they had four positions that will receive a pay reduction.
00:03:15.820 But it's not for current employees.
00:03:17.600 It's for future employees.
00:03:18.780 So the bottom line is, out of millions and millions of government employees covered by our information requests, there were no pay cuts.
00:03:27.300 And when you talk about how far back this goes, yeah, it's possible that, you know, in 1927, the Fisheries Department took a pay cut in some way.
00:03:35.700 But we're talking about overwhelmingly compensation that's only ever rising and never going back, even when the economy itself retreats, it sounds like.
00:03:45.020 Yeah, basically.
00:03:45.720 I mean, we fundamentally have two different societies when it comes to working in this country.
00:03:52.060 You have those outside of government who, as you alluded to, have to face the ups and downs of the market.
00:03:58.100 Companies have to respond.
00:03:59.560 They have to compete.
00:04:00.560 They have to be responsible.
00:04:01.760 They can't just rack up enormous amounts of debt and not worry about how they're going to pay for it.
00:04:07.600 And then on the other side of the equation is government and government.
00:04:14.620 And I mean, there's been hundreds of thousands of employees in government who actually received pay increases during the pandemic.
00:04:21.300 In some cases, those were contracts that had been signed before the pandemic hit.
00:04:27.360 But in other cases, you had the government out signing new contracts with pay increases during the pandemic.
00:04:32.360 And the CTF, the Canadian Taxpayers Federation, found that over 300,000 federal employees alone received a pay increase during the pandemic.
00:04:40.360 So it's really two different worlds.
00:04:42.780 And I think it's fair when people ask that question, how is this fair for everyday working people who are having to face these tough economic times?
00:04:53.380 And yet they're paying for people in government who don't really have to face it.
00:04:56.740 I do get the question of fairness, but if you're a public sector worker who signed up to work for whatever department or whatever municipality under a certain set of circumstances,
00:05:07.720 I can understand you listening to this interview right now and saying, well, hang on.
00:05:11.440 Why does other people's suffering have to become my suffering?
00:05:15.080 I mean, isn't there an argument that instead of trying to be doing this race to the bottom,
00:05:19.000 we could try to remove some of these barriers that were preventing the public sector from having prosperity or the private sector, rather?
00:05:25.240 Yeah, and I think we have to ask the question, well, when would the public sector ever have to feel the pinch?
00:05:32.560 If not now, during a downturn when everyone else is and they're the ones who are struggling to put food on their tables
00:05:40.140 and they're also having to pay for pay increases and those in government to not ever be affected.
00:05:45.440 It just it doesn't seem like a fair argument to say that those in government should never have their belts tightened.
00:05:51.060 And to be fair, it's not it's not the case that there's never any restraint.
00:05:55.360 You will see pay freezes in government.
00:05:57.540 That is not you will see that from time to time.
00:06:01.940 But it's the actual pay cut, you know, a 5 percent cut, a 10 percent pay cut, whatever it is.
00:06:07.220 It's just it's really become unheard of in government.
00:06:09.840 Like I say, the last examples that we identified went back to the 1990s in Ontario.
00:06:14.620 They had Ray Days, which is similar to what I talked about with what Manitoba did, where they had unpaid days.
00:06:20.760 They did do that up to 12 unpaid days.
00:06:23.100 Manitoba did something similar in Alberta.
00:06:25.520 They did a 5 percent pay reduction.
00:06:28.160 PEI did something I believe it was in the late 90s, too.
00:06:30.620 So you did see those examples in the 90s and at the provincial level.
00:06:34.140 But really, it's been a totally different world since the 90s.
00:06:37.260 And you have this this sort of two society state where you have those in government who really are not affected by what's happening in the outside world.
00:06:46.740 And then those in the outside world, people in private sector and nonprofits and that that quite often do have to feel the pinch.
00:06:52.980 And how does the underlying how are the underlying circumstances that led to that austerity in the 90s compared to the challenges in the last year and a half?
00:07:02.540 You know, that's a very good question.
00:07:03.700 My guess would be that it would pale in comparison to what we're facing today.
00:07:07.900 I mean, you look at the federal government alone.
00:07:09.540 They racked up hundreds and hundreds of billions of dollars in debt in one year alone simply to pay for the pandemic.
00:07:17.520 A lot of provinces are back swimming in debt again.
00:07:21.300 So there's a lot of very tough financial situations out there.
00:07:25.340 And I think really what people might want to reflect on is this.
00:07:29.280 How do we address the situation we're in?
00:07:31.040 We've got government spending way more than what they're bringing in in revenues.
00:07:35.300 And that is not sustainable.
00:07:36.940 So how do you deal with it?
00:07:38.560 And often governments present two scenarios.
00:07:40.600 They say we either cut services or we raise taxes.
00:07:44.700 Now, I think a lot of the services that Canadians receive from governments, they probably wouldn't want those cut.
00:07:50.600 Policing, health care, people fixing roads and bridges.
00:07:53.320 And then on the other end of the equation, you've got raising taxes.
00:07:58.120 No one wants to see taxes go up right now because that would hurt a lot of families that are struggling and a lot of businesses that are struggling.
00:08:04.400 So you often hear these two scenarios.
00:08:06.600 There is a third, and that is to do a better job with the revenues that governments have right now.
00:08:11.260 And one thing they can do is cut salaries back a little bit, cut pensions back a little bit, you know, bring the compensation packages back down to size so that they're more fair with what people in outside government are receiving for the same type of work.
00:08:25.580 And that's one way you can ensure the services continue.
00:08:28.200 It's just done a little bit more cost effectively.
00:08:30.200 I know this was a multi-government level project on your part.
00:08:36.040 You went across the country, federal, provincial, municipal.
00:08:38.620 What were the standout examples, really the worst examples, either for lack of transparency or just for how little in the way of restraint they were exhibiting?
00:08:49.180 You know, that's a very good question.
00:08:50.880 A lot of governments didn't even know when the last time was that they reduced pay.
00:08:56.540 You know, like I said, Ottawa told us they don't have any records of ever doing that.
00:08:59.620 I believe it was New Brunswick as well that did that.
00:09:05.260 You know, in Calgary, Calgary is a city that has been struggling for a good five or six years now because of the oil and gas downturn especially.
00:09:14.360 And they gave us data going back to the 1970s showing that there has been no pay cuts at all, zero.
00:09:21.400 And so there's a lot of examples like that where we know that different parts of the country have struggled economically.
00:09:28.040 And you can see that governments just kind of sailed right through, that there was no wage restraint whatsoever.
00:09:34.240 And I think ultimately the big picture is that we see these studies from the Canadian Federation of Independent Business, from the Fraser Institute and others that show this compensation gap.
00:09:44.340 Government employees making more in terms of their total compensation than people outside of government doing similar work.
00:09:50.340 And so the end result is you have everyday taxpayers that have to pay more for those in government to make this higher compensation level.
00:10:00.680 So, you know, the end result is it costs everyday people more in taxes.
00:10:05.060 And I, you know, to be clear, I wouldn't look at the everyday worker in government and say, well, this is their fault.
00:10:13.540 I mean, most people just go to work and they want to put in an honest day's work and get a good paycheck for it.
00:10:18.440 But it's ultimately elected officials and governments that agree to these contracts and they've let these compensation levels run away from what would be competitive.
00:10:27.660 Yeah, and I think it's also important, and I know it's outside the scope of this report, but to look at the general imbalance between public and private sector pay for the same jobs in general,
00:10:39.560 because this is something I know other research has shown is already an area where there's a significant gap.
00:10:45.460 So the public sector employees for the same job in the private sector are making more and pensions.
00:10:50.680 I mean, we could go on all day with this, but I'm glad you've done the work on this.
00:10:53.800 SecondStreet.org has the new report, finding no evidence of any major governments dropping pay despite private sector businesses having to do that or just shut down altogether.
00:11:04.160 Colin Craig, SecondStreet's president, joins us now. Thanks so much for coming on, Colin.
00:11:08.240 Well, thanks for having me, Andrew. And if any of your viewers or listeners would like to actually see their government responses, they're all on our website.
00:11:15.280 They can see them for themselves.
00:11:17.240 Perfect. And we'll put it up on the screen there right now. Thanks very much. We'll talk to you soon, Colin.
00:11:21.700 Thanks again.
00:11:22.200 Thanks for listening to The Andrew Lawton Show. Support the program by donating to True North at www.tnc.news.