Op-Eds
Published in the Globe & Mail on November 12, 2013
By William Robson
Chronically low investment returns on inadequate saving are making more Canadians worry about retirement. Fair enough – but the bigger Canada Pension Plan many unions and provinces are pushing is a bad response. Durable pension improvements for people currently working must rest on more saving by those same people. Instead, “Big CPP” threatens another wealth grab at the expense of the young.
Advocates for a CPP that covers earnings up to a higher cap or replaces more of those earnings stress that the CPP is mandatory, has low investment costs and offers defined benefits. They typically play down how a bigger CPP would take more from…
Published in the Globe & Mail on March 20, 2013
By Finn Poschmann
Every once in a while, budget day brings something truly big that people fail to appreciate until much later.
Something big happened with Canadians’ savings in the 2009 budget, when tax-free savings accounts appeared. The change has repercussions that will reverberate, mostly to the good, for generations to come and will make Canada a world leader in the savings and tax field.
From a standing start, the number of Canadians holding TFSAs has jumped from zero to about nine million, or about one-third of taxpayers. If you had said about a decade ago, when Rhys Kesselman of Simon Fraser University and I first proposed the Canadian TFSA…
Published in Canadian Business on February 20, 2013
By William Robson
St. Augustine famously prayed, “Grant me chastity … but not yet.” Just like the 4th-century saint, Canadians are struggling to get from words to deeds—but in our case it’s our finances. We know saving is good. We know we need to be thriftier, to build our resources and pay down our debts and prepare for retirement. We want to be better. But not yet.
Canada’s household saving rate is less than 4%, and our appetite for housing has made us net borrowers every year since 2001. But we’re not just failing as individuals. Pension plans—the institutions entrusted with our future livelihoods—are also caught between our desire to live well in the future and…
Published in the Financial Post on April 12, 2012
By Geoffrey Young
Two budgets — in Ottawa and Ontario — have announced reforms to rich defined-benefit pension plans enjoyed by government employees. The federal government will raise employee contributions and the normal age of retirement to 65 for new employees, while Ontario will consider reducing benefits to future pensioners to help fund potential pension plan deficits.
Governments are scrambling to keep employee defined-benefit (DB) pension plans sustainable because their employees love them — yet many government employees would be better off if the plans were redesigned. These DB plans systematically transfer income away from groups of employees in…
Published in the Financial Post on March 28, 2012
By Colin Busby and Alexandre Laurin
Ontario’s controversial deficit-cutting budget, tabled Tuesday, will be passed around like a political hot potato by opposition parties at Queen’s Park. Should it get enough votes to pass parliament, it would sprinkle cost-cutting measures across provincial programs, freeze planned reductions in corporate income taxes, and reduce the likelihood of higher taxpayer contributions to public-sector pension plans, among many other initiatives.
The 2012 budget was highly anticipated by a public eager to see how the province would respond to the Drummond commission report to reform Ontario’s public services. And the province’s credit…
