Home Month and Year October 2020 The Alberta Pension Plan – Looking for Solutions to Satisfy all Parties

The Alberta Pension Plan – Looking for Solutions to Satisfy all Parties

Terry O'Flynn.

When you’re getting an unfair deal in something, it’s on you to look for a better solution. That is what the Government of Alberta is doing with the fair deal panel and the referendums we expect to come near the end of next year. The issues at hand are important, but no proposal may be more important for Albertans than the idea of an Alberta Pension Plan.

Business leaders in our province know that we put in a lot for the rest of the country. Between 2007 and 2018 Alberta contributed a net of $239.8 billion dollars to the rest of the country. This happened during two very major economic downturns and recently, where we only saw more and more regulation brought in from Ottawa that hurt our province. While we may not have a veto on issues like Bill C-48 and C-69, we do have other powers that can help us get a fairer deal in the confederation.

That is why it is important for business leaders to look at the Alberta Pension Plan. In 2017 alone, Alberta contributed $2.7 billion more than Albertans took out of the Canada Pension Plan. Dues in Alberta, where individuals are younger and often work more hours, subsidised pensions in other parts of the country.

Albertans are proud Canadians. I, like many other Canadians, are proud of our country’s history, our place in the world, and there is nothing that makes us more excited than cheering on Canadian hockey at the international level.

Albertans are also very generous. Our citizens give more to charity per capita than any other province. We’ve contributed to Canada for years, but there is a difference between being charitable and getting an unfair deal. When it comes to the CPP, we must look and see if there is something better out there for our workers and our employers.

The Fair Deal panel reported that if Alberta withdrew from the CPP and created an Alberta Pension Plan, Alberta’s hypothetical contribution rate could be reduced from the present rate of 9.9 per cent to as low as 5.85 per cent. That is savings for employers and employees on every cheque.

It also represents an opportunity for Albertans to keep the approximately $3 billion annual subsidy to the rest of Canada, while maintaining base benefits for Alberta retirees at a level comparable to the CPP. It also could give us the opportunity to increase benefits for seniors at a contribution rate lower than the CPP.

Could this be an opportunity for us to make our province stronger for the generations to come? While there will likely be a more fulsome debate in the year ahead, the fact that this could come to a provincial referendum in October of 2021 means businesses, and all stakeholders, should start looking at it now. If there is a better deal to be had, we need to consider all the factors and pursue what is best. It’s on us.