Eight of Canada’s finance ministers reached an agreement in principle Monday to increase the Canada Pension Plan but Quebec and Manitoba did not sign on to the deal. Approval requires the consent of seven provinces representing at least two-thirds of the population. It may be enough — just barely But the potential hard feeling in the holdouts is a factor as well. The scheme, if it goes ahead, would go into effect in 2019 and increase contributions for a typical worker earning about $55,00 by $7 a month and employers would match those contributions (the hated payroll tax). The plan would be phased in over seven years until 2025 and it means when people retire their maximum annual benefits would increase by about one-third to $17,478. Nothing is stated but the Ontario government has said that its gestating Ontario Pension Plan would remain unborn if agreement were reached on CPP changes. And then there is Phillip Cross in the Financial Post who says that for the feds all of the unsustainable gap between the pensions of public servants and most everyone else. In fact, says Cross, some critics maintain that the push to expand the CPP is driven by an unspoken need to prop up public-sector pension plans a little longer. However, doing so will only delay the inevitable overhaul of both the benefits and the funding of public-sector pensions.
