QUEEN’S PARK – A mandatory public sector wage freeze is only the first step toward reining in ballooning public service salary costs, for savings to fund core services like health and education, Ontario PC Leader Tim Hudak said today.
“My plan for a public sector wage freeze needs to be followed by reform to the underlying arbitration system that results in these unrealistic settlements in the first place,” Hudak said.
For that to happen, there needs to be clear new rules for conducting arbitrated settlements – rules that take into account Dalton McGuinty’s $16 billion deficit, the 560,000 Ontarians out of work and financially strapped taxpayers and communities, Hudak added.
Hudak was joined by Owen Sound Mayor Deborah Haswell, whose city’s fire service costs are expected to jump to $4.2 million this year from $3.7 million in 2011. The increase is due to higher wage and benefit costs after an arbitrator awarded retroactive pay hikes of 3.6 per cent for 2009, 3.8 per cent for 2010 and 3.6 per cent for 2011.
“Small towns and cities, like Owen Sound, simply cannot afford to foot the bill for outrageous arbitration settlements,” Haswell said. “I welcome Tim Hudak’s efforts to tackle arbitration decisions that do not reflect the taxpayers’ ability to pay.”
Key to the Ontario PC public sector salary arbitration reform plan is legislation that will require arbitrators to:
make decisions that explicitly reflect local economic conditions, such as the cost of living, and local and provincial budgetary constraints, without the assumed ability to raise taxes to fund settlements
adhere to defined timelines for handing down decisions, enabling local governments to stick to their budget planning schedules amid often rapidly changing economic circumstances, and
issue written decisions that clearly explain the reasoning for awards, and show that specific factors have been taken into account – such as local, and broader, fiscal conditions
Also in attendance was Bruce Grey-Owen Sound MPP Bill Walker: “Ontario municipalities are looking to the province for help. An important step towards delivering relief to their budgets is by fixing the arbitration system and ensuring public sector contract agreements reflect the local taxpayers' ability to pay.”
Hudak said there have been too many cases of arbitrators thumbing their noses at taxpayers – basically saying there’s no law to stop them from awarding whatever amounts they’d like, regardless of constraints like the inflation rate, or an employers’ ability to pay.
“That makes the case for both short and longer-term legislated measures: An immediate public sector salary freeze to stop the upward wage spiral, and arbitration reform to ensure that it never starts again.
“It’s plain now that Dalton McGuinty doesn’t have the nerve to confront the union bosses and take these essential steps toward reining in the size and cost of government – so I will.”
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