TORONTO, Aug. 12, 2015 /CNW/ - Premier Kathleen Wynne's proposal for a provincial pension plan fails Ontario workers and abandons the principles of universality and equity embodied in the Canada Pension Plan (CPP), says Marty Warren, United Steelworkers (USW) Ontario Director.
The Liberal government announced partial details of its proposed Ontario Retirement Pension Plan on Tuesday, including the fact many Ontarians would be excluded from participating in the ORPP.
Under the Liberal plan, the ORPP would not be implemented fully until at least 2020 and would exclude employers and employees who participate in so-called "comparable" pension plans.
The Liberals' ORPP would allow for widespread exclusions, including defined benefit pension plan participants, defined contribution plans with combined employer/employee contributions of eight per cent and – potentially – pooled registered pension plans (PRPPs).
"These broad exclusions stand in stark contrast to the CPP, which includes all Canadian workers and employers, including the self-employed," noted Warren.
"The CPP is the model that must be followed to provide predictable, stable and defined benefits to all working Canadians in retirement," Warren said.
"The ORPP would provide needed benefits to some, but not to others. It makes no sense from a policy stand-point for the Ontario government to propose a pension plan design that deviates so sharply from the CPP," he said.
Experts note that defined contribution plans and PRPPs/RRSPs are characterized by higher financial services fees and are subject to fluctuations in financial markets. Under these arrangements retirees do not receive predictable pension benefits and are at risk of exhausting their assets too early into retirement.
"The Liberal government has made a politically motivated announcement to try to influence a federal election campaign," Warren said.
"Instead, this political ploy reveals bad policy from a government willing to bend to the wishes of Bay Street while turning its back on Ontario workers. All workers deserve the security and peace of mind provided by a publicly managed defined benefit pension plan. This plan leaves too many behind."
SOURCE United Steelworkers (USW)
For further information: Marty Warren, USW District 6 Director, 416-243-8792, email@example.com; Bob Gallagher, USW Communications, 416-544-5966, 416-434-2221, firstname.lastname@example.org