This article was originally published by Canwest News Service December 17th, 2009. To view their webpage, please Click Here
WHITEHORSE — As Canada’s finance ministers gathered Thursday to talk about pension reform, a leading seniors group warned they are behind public sentiment on the need to bolster Canadians’ retirement nest eggs.
“The public is way ahead of the politicians now,” said Susan Eng, a spokeswoman for the seniors’ advocacy group known as CARP. “What really matters is that the public discourse has moved away from whether there should be a new retirement-savings vehicle to what shape it should take and how much it would cost.”
The call was echoed in a full-page advertisement in the Yukon News by the territory’s Federation of Labour, which demanded action to give Canadians a chance to “retire with dignity.”
Federal Finance Minister Jim Flaherty and his provincial and territorial counterparts were meeting for dinner Thursday in this wintry and picturesque Yukon capital before digging in at a formal meeting Friday to discuss everything from the state of the recession-plagued economy to the state of Canadians’ retirement income.
A key item on the agenda is a report from economist Jack Mintz of the University of Calgary on the health of Canadians’ retirement income and savings. Sources say his report will not paint as bleak a picture on the subject as some provinces, opposition politicians, unions and seniors’ advocates have.
Such an analysis could help persuade provinces that they have some time to put together an effective package of reforms.
British Columbia and Alberta have been the most aggressive in pushing for pension reform. Although they say they would prefer a national approach, they also say they are prepared to go it alone with a voluntary supplemental pension plan above and beyond the Canada Pension Plan if there is not a national consensus soon.
They point to statistics in their own provinces that suggest as many as eight in 10 workers in the private sector have no company pension plan. Other studies have shown one-third of Canadian families have no retirement savings.
Flaherty told Canwest News Service on the eve of the meetings that “all options” would be on the table, and that the Harper government had not ruled anything in or out.
Among other things, the options being considered include increasing contributions to the CPP, which covers 93 per cent of workers, with the goal of doubling the annual pension, creating a new national pension plan for those who have no workplace pension, increasing tax breaks for Canadians who invest in RRSPs and Tax Free Savings Accounts, and beefing up efforts to educate Canadians about the importance of saving for retirement.
Banks and other financial-services companies are urging finance ministers to stay away from pursuing government-imposed pension options and to focus instead on building up private-sector choices for Canadians.
Flaherty and other finance ministers have said they hope to narrow the list of options during their discussions and set out a timeline for studying them and agreeing on action. Flaherty said the process could take up to a year.