The federal government is too generous in subsidizing public service pensions and it’s time to start levelling the playing field with the private sector, the Canadian Federation of Independent Business says.

“The federal government uses taxpayer dollars to ever-so-generously outmatch its employees’ pension contributions,” the CFIB said yesterday in a submission to the federal government’s consultations on the retirement income system.

“Hard-working lower- and middle-class Canadians in the small business sector should not be subsidizing the generous retirements of public servants, most of whom do not even contribute anywhere near an equal share of their own retirement packages,” CFIB president Catherine Swift said in an accompanying news release.

One of the recommendations in the CFIB report is a gradual increase in the federal public sector pension contribution rate to 50 per cent for employees, “the ratio most commonly used at the provincial level.”

“This would not only act as a fairness measure, but it would also make the federal public sector pension system much more financially viable in the long term,” said the CFIB, which represents thousands of small- and medium-size businesses in Canada.

The CFIB report, called Securing The Future, highlights inequities the federation sees between public sector plans and those in the private sector and is based on the responses of 7,872 small- and medium-sized business owners.

According to the report, 79 per cent of the respondents indicated they did not currently offer a retirement savings plan, such as RRSPs or a Registered Pension Plan.

“The main reason for not offering a plan is that they are too expensive,” it said.