THE HERALD OUTLOOK Saturday November 24 Page Columnists Shortfall in MPs pension plan raises ire OTTAWA The disclosure of a multimilliondollar shortfall in the super pension plan for members of Parliament has fuelled the ire of many disgruntl by political perks Reaction to news of he million deficit in the fund reported to Parliament by tin governments chief actuary Poznanski was predictably immediate swift and shrill In a lengthy denunciation of the pension fund and the shortfall David Somerville of the National Citizens Coalition colled the liability shameful scan dalous and another shaft for the taxpayer The response could have been more strident Pension analysts say the public isn t full aware of unique rules that apply to the fund and the benefits members of Parliament and Senators may lavish on themselves in retirement or toral defeat The shortage represents the governments share of the pen sion pot and the interest owed that has accumulated because of the failure to keep the fund top ped up At the request of Thomson News Service pension experts at Toronto based William Mercer Ltd reviewed the report prepared by Poznanski who works at the Office of the Superintendent of Financial In it ut ions MORE GENEROUS As a plan its far more generous than anybody in private enterprise could ever hope to get Fred hompson com because the tax laws that apply to private pension plans were extended to commodate the wishes of parliamentarians when they designed their own plan explain ed Thompson and fellow Mercer Ltd actuary Paul Purccll Ottawa 3 They make the laws They tan do whatever they want Thomp son said One of the first things they do when they write a law is exempt Ihemselves As an example Thompson pointed out that most Canadians must work years to qualify for the maximum pension benefit of about per cent of final earnings prior retirement A member of Parliament is entitled to per cent of earnings after just 15 years in the plan And while most Canadians must wait until age or until they are within a few years of mandatory retirement to be eligi ble for benefits MPs can collect on retirement after just six years Why must individuals alone be burned Mr Crow is right about the in spiral Still one cant help feeling that there is something terribly unfair about this way of thinking Companies of alt types would be able to pass on higher fuel costs to their customers Consumer prices he admits would rise Individual Canadians would get it two ways they would pay higher prices for almost everything but they would not be able to ask for more money If they did they would get smacked with higher interest rates a shrinking economy and wide spread layoffs No wonder people are becom ing fed up We face a big increase in gasoline and heating oil prices We will pay it again when com panies pass the increase on to us in the form of higher prices for goods and services Then there are interest rates We pay for them when we bor row We pay for them when com panies pass their interest costs on to us in prices And we pay for them with our taxes Soon we will have the goods and services tax as well Guess who will pay Mr Crow and Finance Minister Michael Wilson seem to forget that workers and taxpayers also are consumers Consumer spen ding rightly or wrongly ac counts for twothirds of the North American economy Business is beginning to feel the effect of con who can no longer afford to spend When profits are down guess who pays this time with their livelihood Trade talks resembling Meech Lake discord OTTAWA The current round of world trade talks is beginning to sound ominously like an inter national version of Canada s Lake accord Theres a faint chance that negotiators for the 100 countries involved in the GATT General Agreement on Tariffs and Trade will pull a last minute rabbit out of the hat But as time speeds by hopedimsforadeal With three weeks to go before the grand finale of the four year Uruguay Round in Brussels the United States and the European Community EC the two main combatants are still bran dishing sabres over the dicey issue of farm trade subsidies Last week S Agriculture Secretary Clayton warn ed that no deal under the auspices of the world trade referee would be better than what the Americans consider a bad agree ment Unless the Europeans come up with a better proposition on removal of subsidies than the per cent cut over years they have offered to date they can forget it Yeutter said His colleague S Trade Representative Carla Hills add agriculture is the linchpin of a successful round She said this is because free and fair trade in this area is the highest priority for many countries of Latin America Eastern Europe and Southeast Asia as well as the U S and its supporters But Jacques Lecomte the EC ambassador to Canada has bluntly said the rest of the world is dreaming if it thinks the member community will slash farm supports and export sub sidies to its 10miIlion farmers by the per cent demand by other nations The Europeans say their offer is comprehensive and substan tial No sector and no ty support program has been spared the EC said last week Substantive because a cut of 30 per cent in nominal terms means with an average inflation rate of three cent over years a support cut of per cent in real terms Although other issues besides agriculture are on the Uruguay Round table farm subsidies have Vic Parsons dominated When leaders of the seven largest industrial powers met in Houston last July they declared progress on was critical to the successful completion of the negotia Without an agricultural deal progress in other areas is likely tobe stymied In the war for international support between the two main protagonists the U S is clearly winning Canada is a member of the socalled Cairns Group of food producers which has been mov closer to the American posi The group including fellow grain exporters Argentina and Australia among others began with a basically neutral stance that leaned only slightly to the U S Of late it has been pointedly sniping at the Europeans What happens if the talks fail Earlier this month Trade Mm siter John Crosbie said Canada would suffer extensively if a trade war erupts because the nations cant agree upon the rules of the game With about a third of Canadas economic out put related to trade the country is very vulnerable FARMERS SUFFER Grains Minister Charles Mayer echoed Chrosbie Noting that 80 per cent of Canadas wheat half the barley and threequarters of is exported Mayer warn ed domestic farmers will suffer without greater access director general Ar thur Dunkel has described the current impasse as very grave and cautioned other areas of agreement could fall apart meanwhile Australias trade minister Neal Blewett has said failure could give a green light to protectionist forces around the world This is worrisome particularly with Canada already in recession and our major trading partner the US on the vergfe of a shrink economy One only has to cast an eye back to the onset of the 1930s Depression when many nations including the S and Canada erected trade barriers as a defence mechanism against the economic collapse The tactic didnt work World trade shrank alarmingly as pro tective tariffs rose to precedented levels Many economists and historians argue the barriers prolonged the Depression Already there is a trend toward inwardlooking trade blocs which could intensify if GATT fails The EC will undoubtedly become more introspective ef forts toward an insular North American bloc to include Mexico would be stepped up and Japan might tr for a Southeast Asian group It would be years before repairs could be made to the world trade environment Agricultural issues fuelling free trade fire WASHINGTON Agricultural issues are emerging as the major irritants in the United States as the Canada S free trade agreement its second an niversary American farm groups feel Canadian farmers are getting the long end of the pitchfork In written and verbal testimony to a Senate trade sub committee U S farm groups have raised strong objections to some of Canada farm policies that claim leave American producers at a disadvantage The most serious concern tres around a proposal to halt American re inspection of meal enters the try but Americans have also complained loudly about Cana trade in hogs and pork the threat of inexpensive fertilizer exports and the level of Canadian subsidies Senator Max Baucus a tana Democrat who chairs a sub committee on international trade said recently that Ihe free- trade agreement has been smoothly and many of the US concerns have died down But when two nations ex change billion in goods and services disputes can be ex peeled he said There are a number of very serious trade disputes between the S and Canada that deserve immediate addition at the highest levels of government Here are some of the major S concerns MEAT INSPECTION The U Department of Agriculture has received more than 2 com plaints about a proposal between the two countries to end re inspection of meat on a one year trial basis As long as meat is in by officials in the country of origin it would not be by importing country Concerned about a sharp in crease in U rejections of dian meat several politicians from border slates have called on the agriculture department abandon the proposed if it can confirm that Canadian inspection standards are equal to those in the United States A U S study shows thai the re jection rate for Canada the leading exporter of meat into the United States is two lo four times higher than other exporting tries For instance a total of per cent of all Canadian meat ex ported to the S was rejected by U S last year That compares to a rejection rate of per cent for Denmark for Australia and 16 for New Kevin Bell Zealand Canada and the U S agriculture department say meat inspection standards are virtual identical in the countries but Montana Board of Livestock has proposed that American of ficials inspect Canadian ting plants to ensure they are adequate before agreement is implemented Canada has blamed inspectors fear of job loss among S workers and increased competition for the campaign against Canadian meal products S fertilizer manufacturers are pulling out all the stops in an to halt the construction of a new plant in Saskatchewan A group of S fertilizer pro ducers has asked the U S govern ment lo interene with Canadian officials over the Pro ducts Inc plant now under con in Belle Plame near The ad hoc committee of Domestic Nitrogen Producers claims that the plant is uneconomical and would not be built if it were not for generous subsidies from the Saskatchewan government Saskatchewan is providing 64 million fo the million plant and Cargill Ltd is putting up million Another million comes from an unnamed investor while the rest will come from loans guaranteed by the Saskatchewan government S fertilizer companies say the injurious Canadian subsidy violates spirit of the free- trade agreement and rules under the General Agreement on Tariffs and Trade They add that studies show Saferco will flood the international tilizer market leading to a drop in S prices of 12 to per cent and a four tosix drop in US production As a result the situation presented to S producers can only be described as alarming the group told senators denies the province is subsidizing the plant but has pro vided an equity investment from which Saskatchewan tax payers expect to receive dividends HOGS AND PORK Canadian pork producers are making head way against a S countervail duty bul American farmers may be looking for new ways to halt the import of Canadian pork A GATT ruling recenly found that the S Department of Com acted illegally by impos ing an eight cents akilogram countervailing duty on pork ex ports It recommended that the S reimburse the duties but the US International Trade Com mission concluded recently that it expects Canadian pork imports will harm the U S market in the near future The ruling will help American formers to keep the pressure on Washington to retain the duty The Canadian Pork Council however is optimistic that a binational panel formed under the freetrade pact will succeed in forcing the U S to wipe out the duty But the S National Pork Pro ducers Council is ringing alarm bells about Canadian fanning practices Citing the proposal to end in spections of Canadian meat pro ducts it has raised alarms over two drugs used to treat livestock and poultry diseases and ipronjdazole