Expand CPP, experts urge

Posted on December 14, 2011 in Social Security Debates

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WinnipegFreePress.com – business
Posted: 12/14/2011.    By: Staff Writer – Ottawa

A group of pension experts, including a former chief actuary of the Canada Pension Plan, is calling on Canada’s finance ministers to commit to expanding the CPP.

In an open letter Tuesday to Finance Minister Jim Flaherty and his provincial and territorial counterparts, the group said a growing body of research indicates many Canadians will likely have inadequate savings to maintain their standard of living in retirement.

“Several recent studies project that a significant proportion of middle-income earners risk a non-trivial reduction in their living standards upon retirement,” said the letter signed by the CPP’s former chief actuary, Bernard Dussault, and five others.

The other signatories included Bob Baldwin, an expert adviser for the Ontario Expert Commission on Pensions; Keith Horner, a pensions consultant and a former federal Finance Department official; Jonathan Rhys Kesselman, the Canada research chairman in public finance at Simon Fraser University; Monica Townson, an economic consultant who served on the Pension Commission of Ontario; and Michael Wolfson, the Canada research chairman in population health modelling/populomics at the University of Ottawa.

Canada’s finance ministers are to meet in Victoria next week.

Topics up for discussion include Ottawa’s proposed Pooled Registered Pension Plan framework, the triennial review of the Canada Pension Plan and the state of the economy.

— The Canadian Press

Liabilities questioned

OTTAWA — A new study says the federal government is under-reporting its pension liabilities by some $80 billion.

The C.D. Howe Institute says Ottawa’s unfunded pension liabilities total $227 billion — over 50 per cent more than the government reports in its public accounts.

The study by the independent economic think-tank says that’s because the feds don’t evaluate their public-sector pensions the way the private sector does.

Private-sector plans must use market yields to value their promises; the federal government does not.

The institute says the pension entitlement of the typical federal employee grows at more than 40 per cent of pay annually — much faster than the contributions to fund it.

— The Canadian Press

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