It’s that time of the year again when civic politicians begin drafting budgets and deciding how many additional after-tax dollars they are going to remove from your wallet.
Average pay increases in the private sector have flatlined since the 2008 recession, but that hasn’t dampened the enthusiasm of civic politicians to jack up your property taxes and fees.
For example, the residents of Surrey woke up to a surprise this month when they discovered their annual tax bill will be increasing by at least $100.
In Vancouver, beleaguered taxpayers are facing a whopping 10% increase for sewer and water fees and a 6% hike for garbage removal services.
These increases are in addition to a proposed hike in property taxes to pay for an estimated $52-million budget shortfall.
So why do expenditures continue to escalate every year? Well, it doesn’t take a rocket scientist to see that increased labour costs are the single biggest factor.
Cities are in the business of delivering services demanded by people like you and me.
These services are provided mainly through a large and rapidly growing unionized workforce that received a generous 17.5% five-year wage settlement back in 2007.
That deal is now set to expire and workers will soon be without a contract.
That’s why the Canadian Union of Public Employees (CUPE) is now at the bargaining table with metro municipalities trying to hammer out new collective agreements.
Suffice to say it’s CUPE’s job to demand even higher wages and better benefits for their members. Meanwhile, it is the role of local politicians to ensure the best interests of taxpayers are looked after at the negotiating table.
The reality is if politicians don’t put a lid on labour costs in this new collective agreement, they will be digging even deeper into your pocket in the months to come.
Yet to date not a single civic politician in Metro Vancouver seems prepared to say they support a 0% pay increase.
This position contrasts starkly to what we’re witnessing in Victoria as the province enters negotiations with its unionized workforce.
Finance Minister Kevin Falcon has taken the position there will be no raises for government employees unless new efficiencies can be found.
I certainly don’t blame civic unions when they ask for the moon when it comes to a new collective agreement.
However, I am getting tired of civic politicians who see me as merely an automated teller machine prepared for yet another costly withdrawal.
- Post by Daniel. Originally published in 24 Hours Vancouver.
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“There will be no raises for government employees unless new efficiencies can be found.”
In general that seems like a sound approach. How would we apply it at a municipal level?
Just prior to the holiday The Canadian Taxpayers Federation (I think it was this group) reported that 82% of all municipal taxes goes to salaries and benefits.
That is a HUGE number.
Meanwhile, those same taxpayers are at risk of losing services or programs because the city is in a shortfall.
Efficiencies found !!!
Axe the multi million dollar bike lanes.
Axe a few non-productive corporate managers.
Axe private parties and renovations for mayors and councilors.
Axe private entrances for propeller-headed mayors.
Axe “drop in the bucket” expenditures by Ballem.
Axe tens of thousands given away to special interest groups like $15K to a bike courier startup or $5K? to grow wheat.
BruceWayne
permit me to second your Efficiencies list!
I work with city staff on a regular basis. Most are hard working and professional. However, during the time in my job, I have watched the annual internal shuffle of staff – particularly in engineering. Not sure why.
Consequences are significant. Reports are forgotten, approaches to an issue change with each shuffle, more often than not you have to hit the re-start button to bring the new person up to speed. Why?
You cannot find efficiencies within your own deficiencies …Vision, Robertson, Ballem, Johnston, Maclellan, Toderian, Dobrovolny
First you have to cut the bacon, or in the case of these ones above… the skin.
“Axe the multi million dollar bike lanes.”
At what cost and to what benefit?
There are too many high paying employees at the management level.
The goal is to (i) tie compensation to outcomes and (ii) give people more latitude to figure out new and more effective ways to do their jobs. So what outcomes are you trying to achive with your list?
It would make more sense to focus on the big budget areas: street maintenance; waste management; water supplies; transit. I can also see working harder on those issues that do not cost as much but have a big impact on the city: zoning and other regulations and Julia’s issue of tax fairness between residential and business properties.
I keep reading about core services and ‘council priorities’ when it comes to budgets. Council priorities is this vague political wish list in my books.
I know for a FACT that core services are being cut back to make the numbers work. I think core services should have a benchmark that must be delivered and you find cost effective ways to make it happen.
Who wants to find out mid year that the parks board did not ask for additional money but golly – they are not mowing lawn!
Council Priorities should be paid for only if “core services” are delivered first and to agreed upon standards. Perhaps that would encourage everyone to work smarter and choose projects more prudently.
How about cutting back on all those new unnecessary sidewalks that the Engineering Dept continues to construct, while taking months longer than originally stated to complete them?
Just because it was a good intention during less recessionary times to install them on both sides of every road, does it make sense to continue with this type of work when belt tightening should be taking place?
Does the Engineering Dept have buckets and buckets of money tucked away that is untouchable by City Councils? Am wondering cause there is little logic in some of their street projects.
Axe the bike lanes. Who is doing the maintenance and gardening there? More cost and in a year or two will need more maintenance of the planters. Full of weeds, coffee cups , junk already. And absolutely no one in them. What a waste of money. Have been downtown twice this weekend – empty not a cyclist in sight.
Better not take down Dunsmuir Viaduct either. What another waste of dollars that would be. It would just adding the cost of new roads, new lights, new sidewalks. Oh but guess it would be great for Union jobs. That should make Meggs pals happy. Vision Councillors should deliver Core services and stop dribbling away taxpayers on nonessential items.
you think sidewalks are a luxury? you are obviously not visually or physically impairs. We still have miles of street with no sidewalk on ONE side, let alone two. We also do not have appropriate curb cuts on sidewalk to allow for wheelchairs, scooters, baby buggies and those with visual impairments.
Probably the best 3-5 million we spend out of our CAPITAL PLAN. Sidewalks are not operating budget items.
In case there’s misunderstanding…
Axe any future bike lanes. Too late to save the multi-millions already spent. As for maintaining streets and street lighting, several million have been diverted from the “core” services already to fund your 311 system. It’s a white elephant answering service with several overpaid managers directing too many operators to justify their over $5,000,000 annual burn rate!!! Much of the money was redirected from other departments and their staffing were cut. Instead of people providing real services, 311 staff are layering unproductive duplication. Once they’ve caused you to explain what you want they then contact who your really wanted to talk to. They then introduce the situation to the intended staff(as if we really need to have this happen). Only then can you talk to the intended staff who have to bite their tongues in frustration. What an utter waste.
I challenge you to drive any street in the city and not find lighting in disrepair. That is redirected funding. There’s a certain main artery that I travel often which has several street lights dead for almost two years now. Many at intersections. A lawsuit asking to happen if anyone is injured at any of these intersections. Safety in this city is compromised at the expense of too many fat managers acting on orders from Ballem to cut real services in order to pay for pet projects.
Bike lanes are core services. People who use bikes and whose families use bikes have every right to get around the city salfely. I use the Hornby bikelane and the Burrard bridge to move my grand daughter by bike from the West End to Kits several times per week.
I am happy to get into a debate on which gets more subsidies in Vancouver, cars or bikes, but on this thread lets focus on the original article – the tension between the city and the unions and how to best negotiate and structure union contracts.
to save this post from going off the rails, let’s determine that bicycle lanes are a core service so we can talk about other stuff that has not been debated to death.
PLEASE
The objective of unions, private or public sector, is to maximize member compensation and the number of members neither which speaks to efficient, cost effective delivery of services so take it as given the unions will fight any attempts to reduce costs. And public sector unions enjoy signficant advantages over their brothers in the private sector:
- they do not have to worry about competition putting their employer out of business so there is no outside constraint on their demands. There is no pressure on management either since they will generally piggy back on the compensation won by the union;
- they can exert political pressure in the election of council which is effectively voting for the Board of Directors.
These two factors conspire to make it very difficult to rein in public sector costs, particularly if the successful candidates for council enjoy public sector union support.
What could be done?
One action would be to make union membership voluntary and not a condition of employment. All employees would have to pay dues but only that portion relating to contract negotiation would be mandatory. Dues that were related to political activities would be optional and not mandatory for anyone.
This would make it more difficult to initiate strikes if workers could chose to cross picket lines without the risk of losing their job.
Ultimately, though, it requires electing politicians who have the courage to stand up to the public sector unions. Maybe we will see a start at the Federal level with the next budget.
a good friend just sent me this:
What have we learned in 2,064 years?
So here it is.
“The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance.”
- Cicero – 55 BC
So, evidently nothing..
“In Vancouver, beleaguered taxpayers are facing a whopping 10% increase for sewer and water fees and a 6% hike for garbage removal services. (clip)So why do expenditures continue to escalate every year? Well, it doesn’t take a rocket scientist to see that increased labour costs are the single biggest factor.”
Actually, no. I’m no rocket scientist, but CUPE labour costs have little to do with the increase in water fees (see boondoggle double-tunnel filtration plants, and hundreds of millions given to failed consulting firms, not union employees) or garbage fees (see increased tippage fees being charged by private companies that haul, dump, and burn out garbage.
Well what did anyone expect?
Vision is the power child that resulted when the Eco Greenie Nutter fringe got all sexed up with greedy public sector unions.
Vision has ever met a “cause” that couldn’t be funded with taxpayer’s dollars or a social justice scam that couldn’t be torqued into more wasted spending.
The cost of salaries, wages and benefits comprises about 65% of total expenditures for the City and thus the cost of wage increases are significant. The current collective agreement between COV and CUPE provided a compounded wage increase of 15.4% from 2007 to 2011. In that same period there was an 8% compounded increase in the BC consumer price index. Thus in terms of wages, CUPE members have done very well. In July of 2011 employer pension plan contributions increased approximately 1%. So, COV employees certainly have no argument to make in terms of loss of real wages or earnings. Some sample wages in the CUPE 1004 agreement; Bike Patroller – Seawall = $25.03 per hour ( was $21.71 in 2007) , Lead Hand Bike Patroller $25.33/hr (was $21.97/hr in 2007) and one of my favourites, Miniature Railway Engineer = $26.18/hr. The COV, despite a core services review, continues to include Carpenters, Machinists, Metal Fabricators, Auto Partsworkers and Blacksmiths. Blacksmiths??? Thought that would have gone the way of the dodo. All of these trades earn in the neighborhood of $34.00/hr, add to that fully loaded benefits and a defined benefits pension plan with subsidized benefits for life. That defined benefit plan will replace 65% of the retired employees earnings with the sufficient age and service. There are no caps in the dental plan (“Plan B”) that provides crowns dentures etc., medical and extended health are fully funded by tax payers (dental is 85% funded by tax payers) and employees are credited with one day of with pay for each 4 month period in a year for which they claim no short term disability benefits. So, an employee can receive 3 paid days off per year if the claim no sick absence. They can accrue up to 120 paid days off in this matter which can also be taken as cash when retiring/terminating employment. The liability for this and other deferred payroll items is $84 million.
Pension costs have risen 24% since 2006. Actuarial and annual reports for the plan show an unfunded liability of about one billion dollars. Pensioners in the plan got a 3.2% COLA increase in benefits. So, my suggestion, a defined contribution plan for all new hires with a fixed contribution rate for the employee/employer.
Next, conduct a serious core services review. For non-core services there are wage saving to be had and, most notably, huge capital savings associated with land/lease and equipment costs. The third quarter COV report indicates an estimate run arte of $10 million in savings to the operating budget associates with the last review. That is about .9% od total expenditures for the city. Not a serious effort.
Get rid of the insane contract clause that gives days off for employees who don’t get sick. That will wipe out about $25 million.
Put in some responsible caps on benefit plans.
Don’t blame the unions…..do it to management and union employees.
Julia:
There are the usual suspects that troll these sites for other reason BUT to push bike lanes. They have their own agenda and in cases, a vested interest and can’t see beyond their basic wants. Kind of like little kids pulling at mommy’s apron stings while she is worry about bigger things.
Take it with a grain of salt – they are here to derail any other conversations.
Bill
My problem with unions is not that they want to maximize compensation and protect jobs. That is what one expects them to do. But too often they also have all sorts of job rules that make the work inefficient and shift the focus of negotiations away from outcomes towards process. In general I oppose any agreement that codifies process as process should always be changing and evolving. If one could find a way to may unions (and management) outcome and not process based I think we could get better results. Difficult for sure, and it would take imagination and leadership on both sides of the table, but it could have a great outcome if we could figure out ho to do it.
“My problem with unions is not that they want to maximize compensation and protect jobs. That is what one expects them to do. But too often they also have all sorts of job rules that make the work inefficient”
Steven, my point wasn’t that unions protect jobs but rather want to maximize employment and it is the job rules that facilitate achieving that goal.
But I don’t blame the unions (although I find unions like the BCTF irritating when they profess to be professional organizations) for advocating for their membership. Just don’t expect them to be a partner in finding efficiencies but rather the opposite – obstructionist (look at health care and education).
And don’t expect that responsible leadership is going to spontaneously appear at the bargaining table. What is required is a change in the rules of the game like ending mandatory union membership and permitting replacement workers that might create a better balance between union and employer interests.
Of course this is all very academic since once the NDP is elected in 2013 the opportunity for labour law reform will be lost for at least another 4 years.
The major obstacle to any real progress will be the presence of Geff Meggs. Meggs is deeply behoved to the unions. From the 1980′s when he worked on the staff of the Fisherman’s union, the 1990′s he was the Communications Director for the Hospital Employees Union and his last union gig, executive Director of the BC Federation of Labour. His own private business Tideline Communications has CUPE, CEP and other unions as major clients ( strangely when you google Tideline Comms now, you get no hits ???) Lastly as a VV City Councillor, he had CUPE as the largest single donor to Vision and thus to Meggs. Flip Meggs over on his butt and you’ll find the union label. When he worked as the Communications Director in the Premiers Office (Glen Clark), he was notorious for interfering in negotiations with the provincial servants and healthcare workers. His backroom deals were expensive and wasteful and disrespectful of the collective bargaining process. The centralized entity that previously negotiated city contracts, the GVLRB, has been jettisoned and the COV will now do its own bargaining (apparently) with a brand new executive in charge of HR who has no bargaining table experience. Fertile ground for Meggs to once again lurk in the backrooms of City Hall looting tax payers to reward his CUPE friend. Odd that we have heard nothing from the City or CUPE??? Signs that they are cooking up the deal including the spin to feed to the tax payer.
I’m curious: how many people commenting on union negotiations on this thread have actually sat at a bargaining table at some point?
No play on this?
http://www.cknw.com/Channels/Reg/NewsLocal/Story.aspx?ID=1644115
There’s a huge difference between sitting at a bargaining table as opposed to being responsible and accountable to tax payers for the results of collective bargaining and the subsequent trade-offs that must be made in services to the public when wage, pensions, time off and other monetary items drain the public purse. Particularly when public sector union demands are capitulated to not for reasons of market parity but rather political pay-offs.
It’s easy to start in on the union-bashing, but some things should be noted. Yes, CUPE members are well and fairly compensated for their jobs. But seriously, in a city as expensive as Vancouver, I think everyone should be paid a good living wage. In bashing union members for their “cushy” jobs, it’s almost as if people aren’t happy unless everyone is suffering. Do we want to see more poorly paid jobs with no benefits?
And when it comes to the City of Vancouver, the management there are the quickest to reward themselves. They wring their hands about the budget but mayor and council quickly rewarded themselves with automatic pay raises in the new year. The City Manager and many, many other non-union staff make six-figure salaries, with the city manager pulling in almost $350,000 a year. Since Robertson and Ballem have run the show, there have been non-union (way higher paid than union members) managers added at an alarming rate. In some departments, there is one manager for every two or three union underlings. In one dept., the ratio is one to one. Somehow after a so-called hiring freeze, the postings for manager jobs just snowballed. It’d be interesting to see how many non-union jobs have been added in the past few years. But when it comes time to bargain, it’s the greedy unions who are bleeding the city dry. But in the end, whatever the unions get, the non-union staff will also get and then some.
I would be curious to know how many city employees live outside city limits.
Good question Julia. In CUPE 1004′s endorsement of Vision Vancouver, they made the point that only 500 CUPE 1004 members live in the COV. What I find even more troubling however, is the absence of information about the number of employees employed by the COV. Google Vancouver quarterly reports and have a look at the extensive financial information provided by Vancouver Washington including headcount and other employee metrics. Similarly, Seattle, Portland etc. How can we measure the effectiveness of the management at City Hall in the absence of transparency. “Wordup” makes the point that the high cost of living necessitates expensive labour contracts. What about the private sector employees who work in equivalent jobs in the private sector? Should they subsidize public sector compensation that is out of line with the market? Also, check out the Municipal Employees Pension plan website which is entitled “Paycheque for Life”. Should the bartender who slings my beer and earns $28,000/yr subsidize the lifetime earnings of a public sector employee whose pension exceeds the bartenders wages?
I have to go with skippy and Wordup on this one,with a special shoutout to Bill.The way it is the number of city employees will never get smaller and the debt only gets larger.
“It’s easy to start in on the union-bashing”
No one is bashing unions and they are no more or less greedy than anyone else (neither are the non-union managers). The criticism is directed at the system which fosters compensation and staffing inefficiencies that result in higher costs to the taxpayer. The criticism is also directed at the weak politicians (of all political parties) who ignore the problem because it is politically expedient.
Whether or not there is union-bashing going on doesn’t matter. What does matter (to me) are some of the bad ideas being put forth as solutions to ‘problems’ with unions. Suggesting process shouldn’t be a part of negotiations and only outcomes count is a sure-fire recipe for health and safety issues to fall by the wayside. Making membership voluntary will only result in every new hire subtly getting the message that signing a union card isn’t likely to increase their chances of staying on after the probationary period is over. Beyond contract negotiations, union reps work to help managers and employees resolve differences and find mutually acceptable solutions to workplace issues. Some of the strongest economies in the world also have strong union participation in the political process. As for the City’s unionized workforce, in looking at the various pay scales for positions, I find it hard to believe that City workers are being over-compensated.
I agree with Bill. I have no problems with unions. Refer to the cartoon above that precedes the text in Daniel’s editorial…politicians and unions squeezing the taxpayer. Also a correction to my earlier post regarding the last COV and CUPE 1004 settlement. The annual wage increases in the previous settlement were 3% in 2007, 3% in 2008, 3.5% in 2009, 4% in 2010 and 4% in 2011 which equates to a compounded increase of 18.8%. Again in the same period the compounded increase in the BC CPI was 8.3%. During this same period (2001-2011) the average wage earner in BC enjoyed only a 9.3% compounded increase in wages according to federal gov’t statistics.
“Making membership voluntary will only result in every new hire subtly getting the message that signing a union card isn’t likely to increase their chances of staying on after the probationary period is over”
Wrong. An employee could choose to join the union after the probationary period is over.
What it would do is to make the union more accountable to its members. Now, the union holds more power than the employer over the fate of their members since losing the union card means losing your job in a closed shop. Effectively, forcing people to join a union that supports a particular party is like forcing people to join that party. Totally undemocratic and a violation of individual rights.
Even the home of activist unionism, the United Kingdom, has banned closed shop union contracts.
I think we are agreeing with each other! We need to weed entitlements out of society, and we need to get people aligned on outcomes and let them work out the best ways to accomplish the outcomes. Some unions sometimes interfere with this. So do process driven regulators of all types.
The Thought of The Day
“Mental note to self: To give Bill a kiss on the forehead for his statement.”
This one:
“Wrong. An employee could choose to join the union after the probationary period is over.
What it would do is to make the union more accountable to its members. Now, the union holds more power than the employer over the fate of their members since losing the union card means losing your job in a closed shop. Effectively, forcing people to join a union that supports a particular party is like forcing people to join that party. Totally undemocratic and a violation of individual rights.”
Superb comment, Bill! Shall be put as cover page in ALL union contracts.
And not… in small print!
Geez, just when I said to myself “stay away, don’t get involved…
http://www.youtube.com/watch?v=UPw-3e_pzqU ”
We live in Vancouver and this keeps us busy.
Just read Bill Tieleman’s latest column where he states:
“She has the wisdom, however, to understand that Canada is built on a private sector economy whose success helps provide the public sector services that Canadians depend on.”
It would appear that free-enterpriser Glen Clark (and good pal of Bill Tieleman) has been rubbing off on a few die-hard NDPers. Can you believe that some of them are now supporting the private sector. What a shock.
http://vancouver.24hrs.ca/Columnists/NewsViewsAttitude/2012/01/23/19283806.html
Vancouver Mayor Gregor Robertson says he won’t comment on the city’s bargaining position, “City management is started into the bargaining process with the unions and they do that obviously independent of any politics so I can’t comment on the bargaining and negotiation.”
More incoherent nonsense from the boy mayor. What does “is started into the bargaining process” mean? “…the bargaining and negotiation” Huh?? There’s a difference between the bargaining and the negotiation? Good God man, if the parties have agreed to a media blackout to avoid negotiating in the press just say so. But no, we get a defensive statement that this is independent of politics. The lady doth protest to much methinks. He seems once again to forget he is the CEO of the city and as such, the buck stops with him. With wages, salaries and benefits making up close to 65% of tax payers expense to run the city, he should be able to utter a coherent sentence about these negotiations. I would note as well, CUPE 1004, the union that represents outside workers at the COV, has removed from its website the October 11, 2011 posting wherein CUPE endorses Gregor and other VV candidates and also where Gregor states that he and the other Vision candidates stand in solidarity with the CUPE workers. No politics indeed. On which side of the bargaining table is Gregor sitting? With those whom he expressed solidarity back in October? The Union that was his largest contributor in the last civic election? The tax payers he was elected to represent? The CEO of the COV must be respectful of a media blackout, if indeed that is the case, but he owes the taxpayers an honest, transparent coherent statement on these negotiations.
I second your comment, skippy!
However, I don’t think Mayor’s office of the arrogant selves is going to give it a second thought. Cannot inspire competency to incompetents.
Public Sector Union bashing is always popular topic this time of year. Daniel is still licking his wounds from days gone by. He never sqawked when he was pulling in 6 figures sucking off the tit like the rest of us.
Anyone who has a pulse on the City will tell you the employees are going through an extensive service review. There is a process of accountability never seen before. We are down to the bone and the only place left to look is at some of the fat cats who are near the top of the pecking order.
As for politics, well Daniel, we warned you not to kick the junkyard dog. You did and now your a blogger.
Wonder how much the person who now fills the equivalent job to Daniel’s job is getting paid?
Really. Hmmm, I have heard of no layoffs of regular employees at COV. What has been the headcount reduction at COV? If there were bargaining unit employee reductions, what was the value of the severance? I see no mention of any of that in the quarterly or annual reports published by the COV fiancee department. Sounds like that bone you are barking about has much meat and fat for the tax payer to gnaw away.
Lefties complain about corporations having short-term thinking and only thinking of maximizing profits, while corporate executives grab as much as they can, as soon as they can.
This Vision administration and the union bosses that support it think in exactly the same way.
They are all grabbing as much as they can while they have a chance. The future be damned.
As for policy; ideology is clearly far more important than anything else. Financial costs are irrelevant if the ideology is pure.
Taxing businesses so they move out of the City is unimportant if super-green eco ideology is promulgated. (Happy Planet moved to Burnaby). Discouraging cars from the City to the point of empty parking lots and reduced and quiet retail is considered a success by car-haters.
The financial implications of these policies will be tough for the future generation and pet projects will have to be dumped.
The irony is that Vision and its buddies’ policies for Vancouver will gradually create a city that only will be affordable for increasingly wealthy demographic.
“The irony is that Vision and its buddies’ policies for Vancouver will gradually create a city that only will be affordable for increasingly wealthy demographic.”
Actually, that’s the plan!
That was incredibly imformative. Thanks for all of the content.