OTTAWA – The federal Liberals found themselves on the defensive Thursday over talks to expand the Canada Pension Plan, with the Conservatives questioning the rush to raise benefits and take more off the paycheques of working Canadians.
Just how much more Canadians and their employers could end up paying in CPP premiums is a central issue in negotiations between Ottawa and the provinces that will come to a head next week on changes to the national pension plan.
The government faced questions in the House of Commons from both the Conservatives and the NDP, wanting to know what the government imagines the plan will look like should provinces agree to changes in premiums and benefits.
At a news conference in Burnaby, B.C., Premier Christy Clark said the message Prime Minister Justin Trudeau delivered to her Thursday was that the federal government doesn’t want to harm those regions where the economy is struggling.
“Provinces are willing to be flexible and certainly the prime minister and the federal government want to make sure that this is something that works for small business, that it works for jobs, that it doesn’t affect what in the rest of the country is a pretty fragile economy,” Clark said.
Trudeau only said he wanted to ensure “Canadians are going to be able to afford the things they need in the present while ensuring retirement security for as many people as possible.”
Finance Minister Bill Morneau will meet with his provincial counterparts in Vancouver on Monday where a key agenda item will be expanding the pension plan — specifically, increasing the benefits paid to the country’s retirees, requiring an increase in premiums paid by workers and employers.
Morneau has said he wants to see a deal to expand the pension plan completed by the end of the year, but talks are now in high gear in the hopes of a preliminary agreement much sooner. Ontario has been pushing for an immediate agreement, knowing that any consensus on CPP changes would affect the provincial pension plan that starts to roll out next year.
The talks centre on whether to have an across-the-board increase in premiums that would capture all workers, or to take a more focused approach that targets the most vulnerable Canadians, similar to the provincial plan being pursued in Ontario.
Conservative finance critic Lisa Raitt said the federal government hasn’t provided evidence to show that there would be widespread benefits from an expanded CPP, nor explained the reason to get a deal done now. She called on the government to consult Canadians on any changes.
“I’m not hearing a lot on the motivation for it,” she said of the push for immediate changes.
“Everyone seems to have accepted that it’s a good deal, but I’m not seeing the evidence that on the balance — taking a look at how much money people are going to be removing from their paycheques, which is a given, who is really benefiting at the end of the day for it.”
She said the majority of Canadians know how to manage their finances and save for retirement, and that the government should focus on educating workers about retirement planning and giving them private vehicles to save.
Any changes should target those Canadians who are at risk of not having enough money in retirement, Raitt said.
Hassan Yussuff, president of the Canadian Labour Congress, said the absence of an agreement next week could lead to a patchwork of pension plans across the country that could become a disincentive for employers looking to set up shop, or expand their businesses.
“You’re better off paying a little bit more for CPP than having a patchwork across the country,” he said.
Making changes to the Canada Pension Plan requires the consent of seven provinces representing at least two-thirds of the country’s population. That math makes Ontario’s consent a necessity for any changes to occur — and ensures it, Quebec and B.C. are central to the talks reaching any sort of consensus.