Canada’s largest seniors’ advocacy group has escalated its pension reform campaign with the release of a paper calling for a new, national pension plan to replace the Canada Pension Plan.
A new public retirement savings plan that is “universally accessible, affordable, adequate and sustainable,” is need to replace woefully inadequate CPP benefits, says CARP, formerly known as the Canadian Association of Retired People.
An estimated 11 million Canadians have no workplace pension plan and one in three Canadians retire with no retirement savings. CPP together with Old Age Security (OAS) and the Guaranteed Income Supplement (GIS) provide a typical retiree annual benefits of $16,000 to $19,000.
“The pension crisis will not solve itself,” Susan Eng, CARP’s vice-president for advocacy, said in a statement. “Government has a role in repairing the pension regulatory system and to ensure that everyone has the opportunity to save adequately for their own retirement. How they do it requires expert advice. But doing nothing is not an option.”
The position paper for a new universal plan contains few specifics. CARP says it could be a single national fund modelled on the CPP or a system of provincial and even regional funds.
“The focus of debate should be on whether the various options would provide the level of robustness and sustainability that is critical to providing an adequate level of retirement security for all Canadians,” says the paper. “The current economic crisis has focused public attention on the need for Canadians to prepare for their own retirement and on the absence of a universally accessible vehicle to do so effectively.”
The group Wednesday also released proposals to the Commons’ finance committee in advance of the next federal budget calling for increases to OAS and GIS and a “National Caregiver Strategy” to support retirement security for Canadians caring for older loved ones.
In September, David Denison, president and chief executive of the Canada Pension Plan Investment Board, said the national pension system needs reform and threw his weight behind proposals to create a supplemental CPP.
Meanwhile, Ted Menzies, parliamentary secretary to the minister of finance, is chairing a steering committee examining Canada’s national retirement income system, and some of the provinces have also teamed up to explore options for reform.
Keywords: pension reform