Op-Eds
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…
Published in the Globe and Mail on January 19, 2012
By William Robson
Debate over retirement income is hot. It’s partly that Canadians are getting older. But it’s mainly the growing realization that the next generation of retirees may live less comfortably than their parents have done. People are living longer, and returns on investment are lower. So hitting the targets their parents achieved means today’s workers must retire later and save more.
Further raising the temperature is Canadians’ learning that the stresses affecting their own retirements do not affect the government employees whose pensions they backstop – federal employees heading that list.
Ottawa’s pension plans provide benefits far richer and…
Published in the Globe and Mail on Dec. 21, 2011
By Keith Ambachtsheer and Edward Waitzer
Canada’s federal and provincial finance ministers are gathering on Monday in Victoria, B.C., to determine the fate of pension reform in Canada. The most constructive thing they could do is to make the current federal Pooled Registered Pension Plan proposal work better for Canadian workers who do not have a workplace pension plan.
PRPP success hinges on an agreement to do three things: First, require employer participation; second, specify a well-designed default option; and third, create a fit-for-purpose fiduciary oversight mechanism.
The federal government’s Bill C-25, tabled last month, and accompanying draft…
