The core goal of any country’s pension system should be to provide an adequate system for saving for retirement, available to the full breadth of the population, that is sufficient to prevent poverty in old age. Yet, more than 300,000 seniors in Canada live in poverty now and the number could double by 2030. Twelve million working Canadians do not have workplace pension plans, according to Statistics Canada. And only 5% of all available RRSP contribution room was used last year.
CARP’s principal focus with regard to the larger issues of pension plan coverage and savings adequacy has been on low and middle income earners who tend not to have workplace pensions and are most likely to have not saved adequately for their retirement. CARP has long called for a supplementary Universal Pension Plan (UPP). CARP’s UPP is modeled on the CPP with mandatory enrolment, utilizing the existing payroll deduction mechanism, professional management, a governance role for the members, a mandate that is focused entirely on optimal performance and independence from government or any single employer. Defined benefits (DB) are also essential to achieving all of these goals.
Governments have eventually acknowledged the need for pension reform, but five years after the 2008 recession, PRPPs are the only new addition to the pension landscape. In addition, no progress has been announced on the promise to enhance the CPP. In advance of the June 2013 Finance Ministers’ meeting, CARP is pressing Canadian governments to give Canadians a real solution to the retirement challenge. Below are highlights of five years of CARP action on pension reform.
2008:
- CARP calls for national Summit on Pension Reform
2009:
- Federal Government holds Pension Consultations
- CARP submits Time for a Universal Pensions Plan
- CARP calls on MPs to support increase to OAS, GIS, CPP, universal pension plan
June 2010:
- CARP open letter to Finance Ministers urges action on pension reform
- Finance Ministers commit to new private savings vehicle and modest enhancement of CPP
Fall 2010:
- CARP calls for CPP enhancement and universal supplementary pension plans in consultation papers to the Nova Scotia Department of Finance and Ontario Ministry of Finance
December 2010:
- Federal government introduces PRPPs
- Federal Government backs away from CPP commitment
- Six provinces call for enhanced CPP
- Alberta and Quebec oppose CPP/QPP enhancement
- Finance Ministers make no progress on CPP enhancement
Winter 2011:
- CARP PollTM: Members reject PRPPs without safeguards
- CARP editorial: Public Option for Pension Security – PRPPs not enough
- CARP Open Letter calls on Finance Ministers to enhance CPP, cap PRPP fees
May 2011:
- Conservative Party, NDP, and Liberals Federal election platforms commit to CPP enhancement
June 2011:
- Federal government cancels Finance Ministers meeting
October 2011:
- CARP calls for PRPP safeguards and action on CPP enhancement
November 2011:
- Federal government introduces Pooled Registered Pension Plans Act
December 2011
- CARP Open Letter calls on Finance Ministers to enhance CPP, cap PRPP fees
February 2012:
- CARP to Federal government: safeguard PRPPs with fee caps and defined benefits
April 2012:
- Ontario government renews commitment to CPP enhancement and investor protection on PRPPs
Fall 2012:
- CARP calls on Finance Ministers to move forward on previous commitments
- Provinces respond to CARP open letter urging action
- New Quebec government open to CPP/QPP enhancement
Spring 2013:
- CARP calls on Ontario government to renew commitment to pension reform, through CPP enhancement and PRPP modification.
Compiled May 31st, 2013