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OTTAWA – Canada’s retirement-income system may not be the disaster some politicians and interest groups make it out to be, says the author of a new report that will play a central role in pension-reform negotiations this week.
Jack Mintz is a renowned economic policy expert hired by the federal government to assess the state of retirement income. He spent months looking at retirement savings plans, corporate pensions, the Canada Pension Plan, and income security for seniors.
His influential report is to be presented to finance ministers in Whitehorse on Friday to lay the groundwork for their negotiations on how to force Canadians to save more for their retirements.
But while some provinces and interest groups are adamant about the need to move quickly on a pension system they say is falling apart, Mintz says his report will suggest they all take a deep breath.
The report “is an assessment of how well Canadians are doing in providing for their retirement. It’s not necessarily bad,” Mintz said in an interview.
He did not divulge details of the report, but he cautioned against undertaking major reforms to fix pension problems that might not be there.
“There’s a lot of presumptions that people make on all this stuff,” he said. His main message, he added is “we should start with an open mind on some of these issues.”
Mintz’s report will not be prescriptive, despite his penchant for offering policy options. Rather, the government requested that it be factual, so that ministers can grasp where the strengths and weaknesses of the pension system lie.
Alberta and British Columbia have already done their own analysis of pension adequacy, however, and come to the Whitehorse meeting with strongly held views. They point to the fact that only 20 per cent of private-sector workers in their provinces are covered by company pension plans, and they want to see government create a new public system that will give them benefits when they retire.
While they’re holding out some hope for a “pan-Canadian” system that would use the Canada Pension Plan as a cornerstone, they’ve also said they’ll go their own way unless they see some solid progress in Whitehorse.
Ottawa is in far less of a rush.
Despite pressure from some provinces, labour groups and opposition parties, federal Conservatives have stressed the need to fully survey the landscape and analyze every option before moving forward.
Ottawa has also resisted signing on to an expanded CPP, and has instead highlighted the range of ways that the country’s financial services sector offers Canadians to save for retirement.
It wouldn’t be surprising if Mintz’s report gives Ottawa plenty of grist for its mill, since he is on record as opposing adds to the CPP system, said Susan Eng, vice-president of advocacy with retirees’ lobby group CARP.
She believes Ottawa has been tinkering with minor moves and stalling to give financial services a bigger say – even as the pension system fractures because of the global financial crisis and an aging population. CARP would prefer to see quick action to develop a new universal pension plan based on the CPP.