CARP Alberta: Stick with CPP

One way that CARP advocates for the financial security of older Canadians is through pension protection. Right now in Alberta, as Alberta government’s pushes for public support for an Alberta pension plan, CARP and allies are warning that pulling out of the Canada Pension Plan isn’t worth the risk, especially to seniors.

OP-ED Printed in the Calgary Herald by CARP AND Seniors United Now (SUN).

Many seniors often look back to what life was like ‘before’ – such as ‘before the Internet’ or ‘before smartphones.’ While few Canadians remember what being retired was like before the Canada Pension Plan (CPP), getting older was more nerve-racking before there was a public pension plan to rely on.

Before the CPP, and other social security reforms like Old Age Security, poverty among seniors was prevalent, running as high as 30 per cent. A lifetime of hard work would often be rewarded with a desperate worry about how to make ends meet. Things were, quite simply, much tougher for retired Canadians.

The CPP provides a foundational retirement income for most working Canadians. It is one of our country’s most important and most invaluable public policy achievements. It speaks to our shared values, provides vital support to our seniors and is envied around the world. Not only has the CPP served us well, but repeated reviews have found it is sustainable for generations to come.

Alberta members of the Canadian Association of Retired Persons (CARP) and Seniors United Now (SUN) stand firmly against any proposal to weaken the CPP. And make no mistake: Premier Danielle Smith’s suggestion that Alberta should consider abandoning the CPP and gamble our pensions on a ‘go-it-alone’ scheme will weaken the retirement system for all Canadians. Everyone in this province should oppose it loudly.

Our organizations have three principal objections to the Premier’s plan to break up the CPP.

First, it is a dangerous risk. The premier argues that Alberta is ‘owed’ more than 50 per cent of the CPP’s value – an enormous amount that she wants to use to fund a pension plan of her own. But how would that plan work? Will the rest of the country agree with Premier Smith’s math, or will she kick off years of squabbling and uncertainty? How can we be sure such a plan would remain well managed, that our premiums would stay stable, and that our pensions would be guaranteed and portable? There are no hard answers to these questions. Just political promises. And when it comes to our pensions, political promises simply aren’t good enough.

Second, it is impractical. One of the chief benefits of the CPP is portability. Someone growing up in Alberta might move to British Columbia or Ontario or Newfoundland and Labrador and work for years before coming back. Albertans may decide to retire in another province. Their pension, as an Albertan, is protected. Even when you’ve moved around, your premiums and pensions follow you. Will that remain the case for Premier Smith’s Alberta-only scheme? Or will it stop at the border? There are no honest answers. Only doubts.

Third, it is an invitation to political interference. In the 1990s, with CARPleading the call on behalf of Canadian seniors, all governments, including Alberta, agreed to have the CPP run at arms-length by a professional investment manager. Not only has that meant explosive growth in the fund’s value. It means the fund supporting our pensions is free from political meddling. We don’t want to roll back the clock and have elected representatives deciding to bet all our pensions on a stock of their choosing or some project of their picking. Pensions are for the people who paid into them, not for politicians to use as they see fit.

The bottom line is very simple. For more than half a century, we’ve nurtured a pension system that works, that is studied and copied by other countries around the world. It’s reliable. It’s sustainable for generations. The CPP isn’t broken, and we shouldn’t take the risk of pulling it apart.

What Premier Smith is proposing is a risky, untested scheme that would paint a huge question mark over the future of pensions in Alberta. Pensioners who have paid into the CPP their entire working lives don’t want their contributions gambled away for political purposes. It makes no sense to move away from a system that works.

Our organizations believe the majority of Alberta’s seniors (including the thousands of Alberta CARP and SUN members) don’t want to return to the way things were before. Not if that means before there was a CPP and a level of basic retirement income that was there for all of Alberta’s seniors.

This was published in the Opinion section of the Calgary Herald by Doug Martin and Paul Taylor from CARP and Linda Osborne from Seniors United Now (SUN).