CARP welcomes Ontario Pension Plan to help provide a decent retirement



May 1, 2014

CARP welcomes Ontario Pension Plan to help provide a decent retirement

Toronto, ON: CARP members will welcome the leadership of Ontario in proposing a province wide pension plan to allow Ontarians to better save for their retirement. CARP calls on the other provinces to provide similar plans to provide access for all Canadians

In Budget 2014, Ontario announced that it will establish a province wide pension plan to allow Ontarians to supplement their retirement savings. The Ontario Retirement Pension Plan will be designed to provide a predictable lifetime pension benefit that will replace an additional 15% of pre-retirement income and extend coverage up to $90,000 of salary. Together with the CPP, the ORPP is designed to replace from 30% to 40% of pre-retirement income. The ORPP will be modeled on the CPP with mandatory employer and employee contributions using a payroll deduction mechanism and managed by an independent body with professional investment expertise.

The time is long past for debating whether we need a supplementary pension plan, so it is welcome news that Ontario and at least two other provinces will start the process of constructing a national pension scheme to help Canadians save for a decent retirement. The design of the new Ontario Plan mirrors the successful CPP and several provincial plans in providing the best chance to save for a predictable lifetime pension.

“CARP members have been calling for just such a plan – CARP’s Universal Pension Plan – for years because they know exactly what it takes to get by in retirement and a decent pension is a priority. The proposed pension plan will benefit their children and grandchildren, not themselves directly, but it is a ballot question for them. said Susan Eng, VP, Advocacy for CARP

Two-thirds of working Canadians do not have a workplace pension plan and few other options to adequately save for their retirement. A significant proportion of middle income Canadians are not saving enough to maintain their standard of living in retirement and need to start saving immediately a caution reinforced by the former Governor of the Bank of Canada, David Dodge in his recent paper Macroeconomic Aspects of Retirement Savings

The federal, provincial and territorial finance ministers failed to get federal agreement to a modest increase to the CPP at their December 2014 meeting. That would have been a welcome step in the right direction to providing access to a national supplementary pension plan.

Any new pension scheme should be available to all Canadian workers regardless of where they live and pension benefits should be portable among workplaces across Canada. This may be achievable if all provinces follow the lead of Ontario, Manitoba and Prince Edward Island in enacting parallel legislation with reciprocal provisions.

CARP has called for a Universal Pension Plan, modelled on the CPP, but not necessarily part of the CPP, with key features to provide for an adequate retirement income including payroll deductions, mandatory enrolment and contributions, professional management and a governance board independent of government and the employers, on which employees interests are represented, and designed to provide an adequate and predictable retirement benefit.

The Pooled Registered Pension Plans (PRPPs) proposed by the federal government acknowledge that Canadians are not saving enough but have been criticized by pension experts and CARP members as not being up to the task of  providing an adequate pension. In any event, provincial enabling legislation is not yet in place across Canada.

CARP is a national, non-partisan, non-profit organization committed to advocating for a New Vision of Aging for Canada, social change that will bring financial security, equitable access to health care and freedom from discrimination. CARP seeks to ensure that the marketplace serves the needs and expectations of our generation and provides value-added benefits, products and services to our members. Through our network of chapters across Canada, CARP is dedicated to building a sense of community and shared values among our members in support of CARPs mission.

For further information, please contact:

Sarah Park   416.607.2471
Media Relations, Policy Researcher and Coordinator
[email protected]

Michael Nicin   416.607.2479
Director of Policy
[email protected]

Siobhan MacLean 416.607.2475
Media and Communications Coordinator
[email protected]



Susan Eng
Vice President, Advocacy
[email protected]

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