Source: The Canadian Press<\/i>
Provincial and territorial finance ministers have thrown their support behind a proposal by their federal counterpart to make new private-sector pensions available to small businesses and the self-employed.
However, further talks on an expansion to the Canada Pension Plan — which six provinces and several labour groups had been pushing — will have to wait until the finance ministers meet again in June.
Federal Finance Minister Jim Flaherty called the agreement on Pooled Registered Pension Plans a \u201cmajor breakthrough,\u201d though many details have yet to be hammered out.
\u201cThey will make well-regulated, low cost private sector pension plans accessible to millions of Canadians who have up to now not had access to such plans,\u201d Flaherty told reporters after meeting with provincial and territorial ministers in Kananaskis, Alta., Monday.
\u201cIn fact many employees of small and medium-sized business and self-employed workers will now have access to a private pension plan for the every first time.\u201d
Flaherty said finance officials will talk with employees, employers and financial institutions in the next month to make sure the plan meets their needs.
Finance ministers from six provinces had said they were not necessarily opposed to the pooled pension idea, but they also said CPP improvements were necessary to ensure Canadians have adequate income in their retirement.
\u201cOntario supported the federal proposal, but we don\u2019t think that it goes far enough,\u201d said Ontario Finance Minister Dwight Duncan, who had been pushing a combination of the CPP enhancement and the private-sector plan.
\u201cWe\u2019re very pleased that finance ministers today agreed to keep Canada Pension Plan reform alive.\u201d
Before going into the meeting, Flaherty said a CPP revamp is not off the table long-term, but that the time isn\u2019t right time to make major changes.
\u201cRight now is probably not a good time to impose any more burdens on employers in Canada because the economic recovery is fragile. We want to continue to create jobs in Canada, so we have to be cautious and moderate in what we do, and it needs more work in any event,\u201d Flaherty.
Alberta Finance Minister Ted Morton threw cold water on the notion that CPP changes would get much support from his province.
\u201cIt\u2019s hard to imagine much interest in pursuing that in Alberta,\u201d he said as he left the meeting. The province was one of three that had been critical of a CPP expansion.
Quebec Finance Minister Raymond Bachand said the pooled pension plan will be \u201cvery efficient,\u201d especially if it\u2019s compulsory for employers to offer the plan to their workers. It would not be mandatory for the employers to contribute to the plan, and employees would have the option of opting out.
Gil McGowan, president of the Alberta Federation of Labour, said he was disappointed a decision on CPP has been pushed out into the future.
\u201cMy big fear is that reform delayed may become reform denied, and that even though they\u2019ve managed to get a promise that people will keep talking about CPP that the reality is that this option may be scuttled,\u201d he said.
Earlier, McGowan said he doesn\u2019t buy the idea that improvements to the CPP have to wait until the economy improves.
\u201cThis argument that a recession is no time to make major policy change is a red herring because there are all sorts of ways to get around those concerns,\u201d he said.
For instance, McGowan suggested, finance ministers could agree on a policy Monday, but phase it in gradually or wait until 2012 or 2013 to enact it.
\u201cWe had a real opportunity and I think we still have one to make a game-changing policy change that will improve the lives for future generations of Canadians,\u201d he said.
\u201cOur hope is that the provincial finance ministers who support CPP expansion will be successful in encouraging Jim Flaherty to come to his senses and realize that his original position in support of CPP expansion is really in the broader public interest.\u201d
While the ministers were at the meeting, protesters occupied Morton\u2019s Calgary constituency office protesting the province\u2019s position on the CPP.
\u201cIt\u2019s time for Ted Morton to stop playing politics with Canadians\u2019 retirement futures,\u201d Nick Lepora, president of the Calgary and District Labour Council, said in a statement.
The Canadian Taxpayers Federation voiced support for Flaherty\u2019s private-sector proposal. It said a CPP hike would only mean higher costs for small businesses.
\u201cAt the end of the day the best way for government to help Canadians save would be for them to leave more money in the pockets of taxpayers,\u201d said federal director Kevin Gaudet.
The Canadian Restaurant and Foodservices Association also urged Ottawa not to increase CPP premiums, suggesting it would be low-income, entry-level workers who would shoulder the greatest burden.
\u201cIt is unfair to propose across-the-board increases in CPP premiums when the objective is to provide enhanced benefits for higher-income earners, who may not have adequately saved for retirement,\u201d said president and CEO Garth Whyte.
\u201cThis approach will reduce take-home pay for lower-income employees and jeopardize jobs, particularly for youth.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Economic recovery is fragile<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2312,2324],"tags":[2658],"yst_prominent_words":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/261970"}],"collection":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/comments?post=261970"}],"version-history":[{"count":0,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/261970\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/media?parent=261970"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/categories?post=261970"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/tags?post=261970"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/yst_prominent_words?post=261970"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}