At a meeting in Chelsea, Quebec, provincial finance ministers had an opportunity to move forward on expanding the Canada Pension Plan. But despite high levels of support, finance ministers have again failed to act to provide real retirement security for all Canadians, and have stalled further discussions until June.
A much discussed report tabled at the meeting looked at several options for CPP expansion. The Ministers, however, failed to act on any of the options, even though the report clearly states that in the long-term, increasing CPP benefits will have economic benefits by increasing the spending of retirees.
“The question is not whether we can afford to do this – the question is can we afford not to?” asked Paul Moist, National President of the Canadian Union of Public Employees. “The report on CPP expansion for Finance Ministers clearly shows that expanding CPP will improve the retirement security of Canadians: more retirees will have enough savings to live on and fewer retirees will have to depend on the Guaranteed Income Supplement.”
The report also shows that employers can manage the increase in CPP premiums over the long term.
“Corporations in Canada have already been profiting even more from substantial corporate tax cuts under the Harper government,” added Moist. “We should also remember that the last time CPP contributions were increased, in the late 1990s, the unemployment rate declined significantly even though CPP benefits were not actually improved at the same time.”
The report also shows that the Ministers were looking at options that fall well short of the labour movement’s widely supported plan to double the benefit level under CPP.
“CUPE calls on these Ministers to recognize the rare opportunity before them by supporting an expansion of the plan that will bring real retirement security for all Canadians, particularly middle and low income earners,” said Moist.
The Finance Ministers will be looking at the state of the economy in June to determine what kind of “modest” CPP expansion they will support. CUPE urges them to consider not only the state of the economy in June, but to consider the long-term state of the economy if they fail to act, or if their increase of CPP is too modest. The report clearly shows that too modest an expansion would still leave significant numbers of lower and middle income Canadians without enough income in retirement. A full doubling of CPP would mean Canadian seniors retiring with adequate income, less fiscal pressure on the GIS, more spending and a better, fairer economy.
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