Splitting with CPP a risky idea

By Lethbridge Herald Opinon on June 26, 2020.

Now that we’ve passed the summer equinox, and we’ve seen the longest day of this very challenging year, it’s clear that summer has arrived here in southern Alberta. We’ve celebrated the dads in our lives, we’ve feted the grads moving out into the world, and we’ve (mostly remotely) celebrated Pride month while reflecting on just how far we still have left to travel on the path to justice for the LGBTQ community. Many of us have also been forced to reckon once again with the continued struggle for justice that is faced by communities of colour and our Indigenous neighbours in this province and country.

Through all of this, many of us are preparing for a summer that will look very different than summers past. Whether this is the challenge of finding child care while we transition back to work or grappling with the loss of the many festivals and celebrations normally associated with summer in our city, there can be no doubt that much has changed over these last months. Some of this change has been good – rarely have I seen the spirit of this community on such wide display – while so much else has been less positive.

Unfortunately, it seems that our provincial government wants to impose more negative changes on our province.

Last week, Jason Kenney accepted the report of his Fair Deal Panel. The panel, despite the government’s assertion that it would improve Alberta’s position in confederation, was actually designed to distract from our struggling economy and thousands of lost jobs, even before the pandemic. Perhaps most concerningly, the panel endorsed the idea of pulling Alberta out of the Canada Pension Plan (CPP) and going out on our own.

This risky ploy is an easy thought experiment for a man with a gold-plated Ottawa pension received after a career spent as a politician. For Mr. Kenney, this is all hypothetical: he’ll never have to rely on the CPP to retire.

For so many of us, though, the CPP is one of the few securities that we have as we age. The CPP, coupled with whatever savings we were able to put away when raising our kids and the equity that’s in our homes, is the backbone of retirement dignity for most Albertans who don’t have access to defined benefit pension plans through their workplaces.

Further, and to put it bluntly, that money is ours: paycheque after paycheque, month after month, Albertans have paid into the CPP in the understanding that there would be something there for them when they retire. Because it’s one of the few securities in Canadian life, I doubt many of us want that money placed on the roulette table in a dangerous game of political brinksmanship.

What’s worse is that the government’s own analysis shows that this is a risky idea that puts the future of public pensions in our country in question. In a briefing note to the Minister of Finance obtained by the NDP, department officials warned that an independent Alberta Pension Plan would face many uphill battles. Among these challenges were higher administrative costs, more volatile contribution amounts, and less ability to ride out market-based risk because of the smaller contribution base. So, what does all of this mean? In all likelihood, it means that if the Kenney government were to proceed with this short-sighted idea we would have less security in retirement, working Albertans would likely see higher contributions come off their paycheques, and the fund would get lower returns in the long run.

Higher contributions. Lower returns. Less stability. That’s what we could expect if Jason Kenney follows through with his plans for CPP.

At the end of the day, these spiteful political games could endanger our retirements. Only someone who didn’t need it would take something as serious as our retirement security as lightly so as to use it as a political distraction. We all must stand up and tell him to keep his hands off our pensions.

While this is no doubt troubling, I am encouraged by what I have seen over the past weeks and months. I know that when the chips are down Albertans will stand up for each other, and for the things that matter. We need to do that again my telling this government to stop playing political games with our retirement. You can start by visiting handsoffmycpp.ca.

Should you need to contact me or my staff, please reach out to Lethbridge.west@assembly.ab.ca, or call 403-329-4644.

Shannon Phillips is the NDP MLA for Lethbridge West. Her column appears monthly.