Op-Eds
Published in the Globe and Mail
The creation of the Canada and Quebec pension plans in the 1960s and subsequent amendments to them in the 1990s is a compelling story of how governments worked together to create and sustain one of Canada’s greatest public-policy achievements. Today we are faced with the thorny issue of how to determine a fair basis on which Alberta might choose to exit the CPP.
When the CPP was created, Ontario requested a provision to allow a province to leave the CPP by setting up an equivalent provincial plan. While open to different interpretations, Section 113 of the CPP Act describes the calculation of the amount to be paid to a withdrawing province. Its essence is to transfer to the pension fund of…
Many commentators, including the prime minister and leader of the opposition, have now weighed in on the downsides of Alberta withdrawing from the Canada Pension Plan (CPP) and creating its own Alberta Pension Plan (APP). The Alberta proposal puts at risk a plan that has been providing secure retirement, survivor and disability benefits for nearly 60 years.
Much of the criticism and concern revolves around the $334 billion that a report prepared by the actuarial firm LifeWorks for the government of Alberta says the province should claim in compensation for assuming responsibility for paying the future benefits Albertans earned while their province was part of the CPP. The amount is 53 per cent of CPP’s current…
Since the release of the Alberta Pension Plan report, I’ve read with interest the steady stream of commentary and opinion and, while there have been some thoughtful pieces, much of it has been ill-informed and misleading.
Doubt has been cast on the credibility of the firm that researched and delivered the report. Questions have been raised about the relevance of the formula used to calculate the transfer amount. And there seems to be general disbelief that a province with only 12 per cent of the nation’s population could have title to 53 per cent of the assets of the Canada Pension Plan (CPP).
Albertans will only be able to properly weigh the risks and opportunities of an Alberta Pension Plan (APP) when these…
Is the federal government thinking of limiting the foreign assets Canadians can own through their pension plans and RRSPs? Rumours to that effect are spreading among Canada’s pension plans and investors.
The rumours are plausible. As a recent C.D. Howe Institute report documents, business investment in this country has been so weak that capital per worker has actually been falling. That deadens productivity growth, which causes living standards to stagnate. A government that puts populist intervention ahead of principled economic policies, as this one often does, might want to force Canadian savers to invest more in Canadian assets.
How might it do so? Pension funds and other institutional investors have a…
With the worst of COVID-19 behind us, the federal government needs to re-focus on long-standing stresses, including tax rules that limit many Canadians from saving as much for retirement as they would like and may need, and that force them to draw their retirement saving down faster than is prudent.
MPs and federal public servants have tax-backed plans that guarantee them indexed payments for life. Most Canadians cannot look forward to retirement incomes that are anything like as generous or secure. The C.D. Howe Institute’s 2023 Shadow Budget contains measures to reduce this unfair gap — measures Finance Minister Chrystia Freeland could bring out of the shadows next week!
1. Let Canadians…
