Hey there, time traveller!
This article was published 14/12/2012 (1349 days ago), so information in it may no longer be current.
OTTAWA -- Finance Minister Jim Flaherty is reintroducing options for enriching Canada's primary pension plan, but says the time is still not right for acting.
The dual message comes as Flaherty prepares to welcome provincial and territorial colleagues to a government retreat outside of Ottawa on Monday, where pension reform will again take centre stage in discussions.
A spokesperson for Ontario Finance Minister Dwight Duncan, who is leading the charge on pension reform, said Friday the province would not enact Flaherty's voluntary pooled pension plan concept unless there is "enhancement" of the Canada Pension Plan.
But in a pre-meeting session with reporters, Flaherty said while he supports in principle boosting the CPP -- which would mean increasing premiums as well as benefits -- the economy remains too weak.
"I don't think we should do this now because of the softness of the economy," he said.
"This is not the time to put another burden on employers and dampen employment prospects of Canadians."
That's also the view of Saskatchewan Finance Minister Ken Krawetz, who said while modest tweaks are not out of the question, he would oppose "radical changes" to the CPP.
"We do not want to see certain restrictions on employers that may prohibit growth," he said.
Flaherty said one option that likely will be discussed is whether there is agreement on expanding the Canada Pension Plan once the economy improves, calling it a "reasonable position."
Growing the CPP was the main option for pension reform before the finance ministers in 2010. However, Ottawa withdrew its backing in the face of opposition from Quebec and Alberta and a weak economy.
In response, the federal government introduced the so-called registered pooled pension plan concept, a voluntary system designed for workers in small and medium-sized firms that many believe will do little to address the problem of Canadians entering retirement with insufficient savings.
New Democrats and the Canadian Labour Congress have proposed doubling what the CPP would pay out over a seven-year period to $1,868 a month, although that would also entail raising premiums on both workers and employers.
Enriching the CPP also has the backing of CARP, the main lobby group for seniors.
NDP industry critic Guy Caron said Flaherty shouldn't just look at the impact of added premiums on the economy -- there are benefits as well.
"One of the aspects for (a premiums) increase is that this money will actually be invested... which will have an effect on the economy," he said.
Given that not all provinces are onside and opposition among business groups remains stiff, any improvements to the CPP would likely be modest and come with a lengthy phase-in period.
Flaherty said he would not act unless the decision is unanimous, even though technically he needs the support of only two-thirds of provinces representing two-thirds of Canada's population.
"It's important in the federation that if you want to do something fundamental with respect to the Canada Pension Plan, we really try to do it all together," he explained.
-- The Canadian Press