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George, thank you for your persistence on those that don't qualify for CPP. I'm young and have an RRSP but I'd happily pay more tax for a just society.
Enter a federal government intent on balancing budgets and federal employees pensions. "Hands off our pensions" is the cry, even while an Ekos survey last week found "only 14 per cent (of 3006 Cananadians polled) supported higher taxes as a way to balance the books. Cutting services and spending was the far-and-away favourite of 46 per cent." (how surprising) "A further 10 per cent said deficits should continue and 30 per cent had no response."
And how does one imagine the Conservatives will play those figures at election time? Or just at this upcoming budget? Perhaps the initial title of this thread , how the Cons will use pensions as a wedge issue, will not have been too far off the mark?
From Oct. 22, the first posting:
"The market collapse and newly, non-competitive manufacturing companies folding have combined to leave many people with little in the way of pensions, outside of the government administered old age and CPP. The Globe revealed last weekend that there is a huge disparity between the health of public service plans and private sector. While 84 per cent of public service workers have pensions, and three-quarters of these are guaranteed, defined benefit pensions, only 25 per cent of private sector workers have a pension plan, and only 16 per cent of these plans are defined benefit pensions. Some 11 million - 60 per cent - of Canada's workers have no pension at all, and 8 million - 45 per cent - have no pensions or RRSPs.
Jack Layton is calling for expansion of the CPP. But one can just imagine how the Conservatives are salivating at the prospect of making this a wedge issue - while working to enlarge the insurance industry's take - next election. "
In today's Globe, Marco Mendicino, acting president, Association of Justice Counsel says a federal government attack on public service pensions "would be a serious mistake...It is true that public servants have good pensions. We pay for them by deferring a significant part of our salaries. (30 per cent of the pension premiums I believe, federally, Ontario public employees, including teachers, pay half the premiums, ed.) Rather than attacking pensions, the federal government should be touting the public-service model as a means for improving postretirement security of all Canadians."
The "rub", of course, will be how to do that for all Canadians. Particularly in a market economy with an uncertain market. A lawyer friend advised he daughter to shift RESP funds for her granddaughter after its precipitous decline last winter and spring. Maybe they were in ABC Paper?
Pensions are an important issue for politicians who can count.
Thanks for the link, Doug, and while I do agree that pensions are an important issue for all kinds of reasons, I think the author of that column is just being polemical in support of his publication's target audience.
The idea that political parties should ignore young people is really, really dumb. To get them for life you have to get them when they're young, plus they're the source of energetic organizers who grow into smart policy people and wily strategists. The NDP struggled to stay afloat for the last 20 years, and lost a whole generation of youngsters. It's so great to go to a meeting these days, and see nearly half the executive elected from folks in their late 20s and early 30s.
The lost generation was lost to the good life, a product of social democratic action, OO. Nothing like the prospect and experience of hard times to re-light the old ardour.
The cons will next week announce "consultations" with people across the country on Canada's pension system "asking Canadians what it will take to get them to save more for retirement and what should be done to keep those savings safe," writes the Globe's Bill Curry out of Ottawa. the tour is to "produce clear recommendations for a federal provincial finance ministers' pension summit in May."
Oh, I'm sure there's that.
Young people today are lazy, disconnected, whiney, spoiled, blah, blah, blah, blah, blah. Don't know politics, disengaged. Eh, by now I've been told why I shouldn't be able to vote for so many damned reasons that I find it kind of condescending when people make broad judgements of young people who are interested in politics - no matter how justified it is, it always floats to my ears as conceited and uncaring. I'm not at all saying that this is like you GV, but believe me, being in your 20s these days and interested in politics is a 1 way street to being told how stupid you are or how unentitled you are to your opinions.
But from personal experience, the NDP can be aloof and treat even long time supporters/card holders as total outsiders. Even when you're young - which from more than one history book I've read, seems to be a significant portion of cells in the life-blood of the left (and politics of all stripes). Sometimes stuff is great; I had a lot of fun with the youth group and learned quite a bit, but I can tell you that sometimes it is nigh on impossible to get any more contact from the party than your requisite few times a month fundraising flyers and telephone calls.
If you look closely, PB, I was not referring to young people, or even to this generation of young people. In fact, it was their parents that copped out. Seems to me the young that turn out for party functions are children of the party followers. NDP youth turnout in Peterborough in 1961 was a joke; children sent dutifully to enroll, but with no idea of what they were doing there. I think it would help today if the party could instruct the young on how we can reconstruct the monster that employs them and at the same time threatens their very existence. But that is not the stuff of happy partying for youth. You have to be as insensitive as your neo-con parents to get a "kick" out of politics today. New Democrats have to get a bit angrier about such prospects. Discuss them while talking social/economic remedies, not just disparities...
I would think that pensions are about to become the only "safe" subject for discussion given the embargo on taxes.
..by the 70's a lot of young people began leaving the ndy because the ndp wasn't radical enough. many of the young folk found homes in various left groups.
Where do you think youth are on the subject of pensions? .....or any subject....?
..tough question. this past saturday i attended a fund raiser for the olympic defence fund..for those who were arrested during the olympics. the event was put on by "no one is illegal". there was close to 100 people that showed up. most were young people in there early twenties. the same venue was also sponsoring another event which was a grade 7 class presenting their recycling project.
..from what i read there is a number of the university student issues that have incorporated teachers, janitors and other non teaching support staff into their struggle..demanding fair wages and benefits.
..when the 2nd bush invasion took place i remember reading reports about children from texas and other places wanting to leave school to join the protests. in some places there was an attempt to prevent them from leaving the school but the kids went out windows and climbed fences to get away. i'd never heard of anything like this before.
Check this out...great bill. It's too bad it didn't come in time for the Nortel folks, but it may be in time to help workers at Abitibi and at other companes that are in restructuring.
http://www.ndp.ca/press/new-democrats-introduce-pension-security-bill
I hope the party gets behind this bill and pushes for the all-party support that Jack seems to be hinting at in his video remarks. It could be a huge victory if it gets through.
P&P had an assessment of this new plan that said it will mainly benefit the banks.
ETA: just read elsewhere that three out of four Canadians struggle to save for retirement without a workplace pension.
I heard an interesting soundbite on my local CBC afternoon radio program. Supposedly, with most traditional pension plans, there is a wait period before you can opt in but with this new program, you are automatically enrolled and have 60 days to opt out if you want out. I can't remember the term used by the expert interviewed but it has something to do with socializing the public into accepting what is best for them. In other words, if you give people a chance to think about it, they might not be proactive in doing what is a wise option. It was suggested that that is why Canadians are not making more use of RRSPs and other tax free savings products/
That makes me think that the prime beneficiary of this new legislation are the banks. The fact that the Canadian Taxpayer Federation applaud this move is even more discomforting.
Bolding mine. I wouldn't put it past the CONservative government to put changing defined pension benefit plans for public sector employees on this path. The Taxpayers Federation have the temerity to compare current defiined benefit plans to those of Greek public employees and insinuate that such plans could lead to our economic downfall.
When Nycol Turmel raised this question in the House today, the PM responded by saying he had no idea what she was talking about - her question was a bit convoluted.
Sorry, but I forgot to provide the link to the Canadian Taxpaers comment:
http://canadafreepress.com/index.php/article/42449
Sorry to hear that Turmel's question was squashed.
It wasn't as convoluted as I made it appear - I think Harper was just being a prick because he didn't want to respond, as is so often the case these days. Harper really hates being held to account. I think we'll see more pettiness from Harper in the next four years - very good news for the Opposition!
The Opposition should drag a fine tooth comb over this piece of legistlation. I for one will opt out if it means my putting in $$$ to pool the investment pool for banks to optimize in their investments. I would rather hold my money in an account that doesn't cost nearly as much to administer. My tax liability isn't so much as to have to shelve earings in RRSPs etc.
Here's the CLC's statement:
CLC criticizes Ottawa for introducing PRPPs: Georgetti says improved CPP best way to provide retirement security
Unfortunately a minority Harper government was still smart enough to manipulate its way out of the growing provincial consensus last year about enhancing CPP/QPP benefits. Instead they dreamed up this PRPP gift to the financial institutions.
Sad fact is the only way we win is by rejecting this proposal. To do so effectively requires left wing economists providing guidance as to how to proceed if you are self-employed or employed by a small business attracted by this option. Making this program fail is key to being able to demand stronger investments to the Public Pension Plan and greater respect for defined pension benefit plans.
It's a defined benefit plan. Benefits are calculated by a formula, not by the amount you contribute.
Defined contribution plans are different in that they're basically segregated accounts where your contributions and your employers are invested for your benefit and become "yours" at retirement (or when you leave the company depending on how the plan is structured). There are umpteen variants out there - cash balance plans and so forth, but they all function pretty much the same way.
Again depending on the plan structure you may receive a lump sum payment (with the resulting tax bill) or you may be required to use those funds to purchase an annuity.
A couple of observations and a question:
1) Introduction of PRPP's and expansion of CPP are not mutually exclusive. As Gaian points out, if one of Alberta and Quebec had been onside with Ontario and the other provinces, there could have been an agreement to expand CPP last year. So I'd put CPP expansion in the "not dead, just resting" category.
2) If introducing PRPP's leads to increased focus on management expenses then that's almost certainly a good thing. Management expenses for most Canadian mutual funds are extremely high by world standards (e.g. 2.5% per year), so if PRPP's come in at (say) 0.5% per year and people get it, they'll switch. If on the other hand PRPP's come in at 2.0% per year, there's not a huge reason to switch.
3) Does anyone know if credit unions will be allowed to offer PRPP's?
True. Neither are medicare and private health care. It's just that when the private option starts growing, some of us tend to worry that it will be used as a pretext to reduce and eliminate the public one - or, at best, not to properly fund and improve it.
That's why progressive people should bite the bullet and work up the nerve to oppose PRPP's, not just to say it's "not good enough". Otherwise, we will one day end up with a pension version of Obamacare.
I think you're making more of an argument in favour of expanded CPP/QPP, rather than one against PRPP's, but I understand your point.
To answer my own question in post #86, here's a link to the draft legislation:
http://www.parl.gc.ca/content/hoc/Bills/411/Government/C-25/C-25_1/C-25_1.PDF
I see nothing that precludes a credit union or a nonprofit corporation from being the plan administrator, but maybe other people are closer to this than I am.