International News

Upcoming Alberta pension report to use exit formula from the ’60s: Opposition

A report on the viability of a provincial pension plan in Alberta is expected to be released by the end of the month — a report the Opposition is characterizing as a “misleading fantasy case” for leaving the Canada Pension Plan.

On Tuesday, Shannon Phillips, Opposition finance critic for pensions and insurance, said she’s been informed of some of the contents of the report expected out in days.

“The report will rely on a withdrawal formula that dates back to 1966 and completely ignores how the Canada Pension Plan is currently invested,” Phillips said.

“It will claim erroneously, falsely, that Alberta is owed hundreds of billions of dollars from the fund. This is complete make believe, because if every province claims their quote-unquote ‘share’ of the fund as calculated by this coming report, it would total nine times what is currently stored in the CPP.”

Story continues below advertisement

Global News has not seen the report.


Click to play video: 'Alberta to further explore its own pension plan and tax collection agency'


Alberta to further explore its own pension plan and tax collection agency


The Lethbridge West MLA said a move to a so-called Alberta pension plan would be a “gamble with Albertans’ retirement security” made by Premier Danielle Smith.

Phillips said a taxpayer-funded advertising campaign to “sell” Albertans on the report will accompany the report’s release.

On Saturday’s episode of Your Province. Your Premier, Smith was asked about when Albertans might be able to see that report.

“I promised that we would release the report. It will be released before the end of the month, and we will have a discussion,” Smith said on Corus Radio.

Global News is owned by Corus.

Story continues below advertisement

Smith has previously said a decision on whether to leave the Canada Pension Plan will be taken to a referendum vote.

A statement from the ministry of finance said the report will be released to the public “when it is ready.”

“Once the report is released, we will consult with Albertans. Premier Danielle Smith made it clear that we will not create an Alberta pension plan unless Albertans are interested and vote to do so through a referendum,” Savannah Johannsen, Minister Nate Horner’s press secretary, said in a statement.

An online Leger poll of 1,000 Albertans from May showed only 21 per cent of Albertans were in favour of creating an Albertan alternative to the CPP. A majority of respondents — 54 per cent — opposed the idea.


Click to play video: 'Albertans to vote on daylight saving time, equalization in the fall; pension and police TBA'


Albertans to vote on daylight saving time, equalization in the fall; pension and police TBA


During the provincial election campaign in May, Smith, then UCP leader, said exiting the CPP wasn’t part of the party’s campaign, despite it being part of the policies passed at the AGM that saw Smith elected leader.

Story continues below advertisement

In the final week of the provincial election, Smith reiterated the province that “no one is touching anybody’s pension.”

The CPP was established in 1965 and saw major reforms in 1997 and 2016. Any changes to the Canada Pension Plan Act require seven of 10 provinces representing two-thirds of the country’s population to agree.

Economics professors have told Global News an Alberta exit would require extensive negotiations with the provinces and the federal government, including on matters like portability.

A clause in the Act leaves the door open for provinces to provide a “comparable” comprehensive pension plan, but “comparable” wasn’t defined.


Click to play video: 'Alberta government continues to explore pulling out of CPP'


Alberta government continues to explore pulling out of CPP


Only Quebec has its own pension plan, dating back to 1965.

“It’s useful to keep in mind that in Quebec, where residents there have their own pension fund administered by the province of Quebec, contributions are much higher than here in Alberta,” Phillips said.

Story continues below advertisement

Critics of an Alberta pension plan have said that, if the province were to separate from the CPP, additional bureaucracy would be needed for the administration of the pension plan.

The report has faced multiple delays, after officials indicated it would be released to the public by the end of 2022 and then by May 2023.

Advocacy group Public Interest Alberta is calling on Smith’s government to release the pension report immediately.

“Albertans need to know that the financially secure, efficient, and sustainable CPP won’t be put at risk by the UCP government,” said Tom Fuller, pension advocate and founding member of the Canada Pension Plan Working Group.

“Not only has the CPP proven itself over the past 50 years, there is a solid plan in place to improve pensions for Albertans and Canadians and to make sure it’s sustainable for the next 75 years and beyond — quite frankly, it’s foolhardy to play these political games.”

&copy 2023 Global News, a division of Corus Entertainment Inc.


#Upcoming #Alberta #pension #report #exit #formula #60s #Opposition

Leave a Reply

Your email address will not be published. Required fields are marked *