And on Friday, Morton reiterated his position, calling the federal and Ontario proposals an “overeaction.” He said low-income workers would be hurt and that higher income earners would get benefits they don’t need.
But Alberta politics aside, the country’s top pension specialists and key business leaders at the conference concluded one by one that retirement income in Canada was heading down an unreliable path. Something needed to be done, and many experts advised a combination of private-sector innovation and a more generous CPP.
“There’s was almost a consensus in the room,” Mintz recalled Friday.
Ontario Finance Minister Dwight Duncan had a more gradual conversion.
“There wasn’t a eureka moment,” he said in an interview this week.
Duncan represents a province where the recession hit hard and no one was in a mood to pay increased CPP premiums — especially after being hit with the Harmonized Sales Tax. Ontario is also home to many of the financial institutions that have lobbied against a larger government role in retirement savings, arguing that they should be unshackled to take the lead.
But this spring, Ontario officials hit the road and held numerous public hearings where they, too, heard a resounding message for government to act.
All the evidence suggested “there are challenges in the system,” Duncan said.
The debate is far from over.
Two-thirds of the country needs to agree, if changes are to be made to the CPP. With Ontario onside, and some other provinces likely following suit, that critical mass can probably be found.
But Alberta’s support is not assured. And while the province is not big enough to veto the proposal, its political weight can’t be ignored.
Plus the country’s main small-business lobby group, the Canadian Federation of Independent Business, is dead set against anything that would increase CPP premiums, by even a penny.
“I think it’s just disgusting,” said CFIB president Catherine Swift. “I’m shocked. Really shocked.”
The group is more than just a thorn in the side of the federal government. Its members are a key constituency for the Tories.
The biggest challenge is figuring out the details, once a consensus is reached, insiders agreed. How fast should CPP premiums and benefits rise, and by how much? How will the government ensure that financial institutions won’t gouge contributors with high fees? Will the proposals take care of the lower class, and if not, should the Guaranteed Income Supplement be increased?
“From what I understand, I don’t think even the governments have any numbers yet,” Mintz said. “It could be another year or two before they work out the changes.”
Keywords: pension reform
