If you think there are already too many people who are old and in the way, "Baby," as the old BTO classic promises, "you ain't seen nothing yet."
Old, in the way and expensive. An unsavoury combination indeed, but that's the reality of Canada's rapidly deteriorating pension landscape.
Little wonder that the federal government is being forced to consider a major overhaul of all its financially unsustainable civil service pensions.
Here's another subject worthy of wonder: how are Canada's other two levels of government planning to deliver on the public-sector pension obligations they've saddled taxpayers with?
Global equity market swoons now being chronic, pension fund prospects are bleak for just about anyone who is still aging.
But all is not lost. At least not yet.
Meet Bill Tufts. He's leading the Paul Revere call-to-arms ride in Canada to alert the sleepy land to its ticking pension time bomb.
The Fair Pensions For All founder is blunt in his evaluation of the past year's impact and his outlook for 2012.
"2011 is going to be a disaster," Tufts told Public Offerings. "When the results are tabulated and the annual pension reports start to come in, you're going to see land mines about pensions going off everywhere in 2012."
Tufts knows from whence he speaks. The long-time employee- benefits specialist is also the co-author of Pension Ponzi: How Public Sector Unions are Bankrupting Canada's Health Care, Education and Your Retirement.
His alarm over the solvency of Canada's public-sector pension plans in the face of the pervading marketplace gloom and the baby boomer retirement tsunami has intensified over the past few years, and for good reason.
According to his calculations, the overall shortfall in Canadian public- sector pensions, which will have to be made up by taxpayers, now sits at around $400 billon.
Pension plans that have been relying on annual returns of 7% from equity markets have instead been eating 6% losses.
They could lose another 16% when 2011's final tally is in.
Things are unlikely to improve any time soon. However, it's not just unaffordable federal civil servants retirement obligations that taxpayers are on the hook for. Provincial and municipal governments also offer generous pensions to their employees.
But the challenge here, as Tufts points out, is that no meaningful studies have been done to determine how deep in the glue provincial and municipal pension plans are.
Considering that the most enthusiastic sucklers on the government pension teat are politicians, instituting those studies is an extremely hot political potato.
Government employee unions also wield tremendous power. The more of them on the government payroll, the more difficult it is to steer the public-pension Titanic away from the approaching iceberg.
Pension Ponzi outlines a 10-step recovery plan to achieve meaningful public-sector pension reform in Canada. It ranges from raising the retirement age and eliminating pension double dipping to capping pension earnings and shifting to hybrid defined-benefit/defined-contribution plans that share investment risk between employer and employee rather than leaving it all on taxpayers' shoulders.
Adopting any changes will require the kind of political brass that is in short supply at the best of times. But options have all but been exhausted in Canada and elsewhere around the globe. The bills are fast coming due. Non-payment won't be pretty. Expect mobs of protesters at the castle gates. Most of them will be old and in the way, broke, belligerent – and very upset. •
