Finance ministers are discussing potential CPP enhancement on June 20-21 when they meet in Vancouver, BC. These discussions should be undertaken as part of an integral approach to strengthening Canada’s retirement savings system. Respected research confirms the majority of Canadians are on track to meet their retirement savings goals through their voluntary savings, pension plans and the federal retirement savings system.
The retirement savings shortfall is not widespread in Canada, but limited to Canadians with modest incomes. As a member of a national coalition of 15 industry groups, the IIAC recommends a national and coordinated approach to reforming Canada’s retirement income system. This approach includes a modest, targeted expansion of the CPP. This would supplement the pension savings of modest income Canadians across the country, eliminating the need for the Ontario Retirement Pension Plan (ORPP), or other similar provincial initiatives. A national approach is favourable to a patchwork of provincial schemes that treat Canadians differently, resulting in unfairness and economic disparities, and limit pension portability in an era of high labour mobility.
Retirement savings reforms should also embrace measures that improve the efficiency of existing tax-assisted retirement savings programs, such as raising the maximum age for RRSP contributions beyond 71, and eliminating the rules mandating minimum yearly drawdowns from RRIFs, as Canadians work longer.