Commission on the Reform of Ontario's Public Services

This fragmented arrangement suggests that, due to their size, some institutions may not be
realizing the economies of scale that would result if this function were more centralized.
The consolidation of administrative processes and practices, including the pooling of assets for
investment purposes, may generate savings. With a consolidated approach, the administrative
functions for plan administration and investment management would be carried out by another
body, and each employer/sponsor would remain the legal administrator of its plan(s), retain
its fiduciary responsibilities and determine plan benefits.
Recommendation 19-10: The province should examine opportunities to achieve savings
and better investment returns through the consolidation of the administrative functions and
investment pooling of pension plans across the broader public sector.
Transparency
Pensions are deferred compensation, and are too often viewed separately from wages and
other, more immediate benefits. In Chapter 15, Labour Relations and Compensation, we
discuss the need to broaden the perspective on public-sector compensation to make it more
inclusive. Pension benefits and their cost must be part of that equation. To accomplish this,
the cost of public-sector pensions to taxpayers must be more transparent.
As noted above, currently the only way to compile a full picture of public-sector pension
expense is by pulling together different entries and notes in the government’s financial
statements. Making these expenses more transparent will assist the government in developing
a comprehensive compensation strategy. It will also assist in making comparisons across
sectors, including the private sector.
Recommendation 19-11: The province must make the government’s cost of the public-sector
pension plans — both in concept and in magnitude — much clearer in the Public Accounts
and other financial statements, including the Budget.
Environmental Risks
Under the Environmental Protection Act (EPA), the province has the “right to compensation”
for loss or damages incurred as a direct result of a hazardous spill, and for all reasonable
costs and expenses incurred for a cleanup. However, as discussed in Chapter 13,
Environment and Natural Resources, difficulties can arise in situations when the owner of
a contaminated site becomes insolvent, no longer exists, or lacks sufficient funds to pay
for the cleanup. While the province can take legal action to ensure the polluter pays for
the environmental cleanup, most often the province is left with the responsibility of the
cleanup and the associated costs.
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