Posted: Friday, 2 March 2012
The Canadian Labour Congress (CLC) is the national voice of 3.2 million workers in Canada. The CLC brings together Canada’s national and international unions along with the provincial and territorial Federations of Labour and 130 district Labour Councils whose members work in virtually all sectors of the Canadian economy, in all occupations, and in all parts of Canada.
A phased-in, fully funded doubling of future Canada Pension Plan (CPP) retirement benefits remains the most efficient and cost effective means of addressing the problem of inadequate retirement savings in Canada. Unmatched by any private sector retirement savings scheme, the CPP delivers a secure, dependable retirement benefit, protected against inflation and payable until death, at a very low cost. The CPP is funded through earnings based on contributions so that future beneficiaries are not dependent on future tax revenue. Virtually all working Canadians are already members of and contributors to the CPP.
By contrast, PRPPs are voluntary arrangements that employers may choose to make available to employees, and to which both employers and employees may choose to contribute. Vast challenges confront PRPPs in achieving anything close to the universal portability that the CPP already provides. Built on voluntary individual savings accounts, PRPPs cannot provide income predictability or security in retirement, as the CPP now does. At a time when workplace pension plans are in retreat and millions of Canadians face income insecurity in retirement, PRPPs are an inferior and inadequate policy response.
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