View From the Legislature

Last week in the Manitoba Legislature, the NDP government brought forward a motion to be debated that criticized the Alberta government for threatening to pull their province out of the Canada Pension Plan (CPP). The motion itself used language that was unnecessarily divisive, but the premise of it (that Alberta should remain in the plan) is one that I agree with and stated on the record.

Just simply on its facts, the CPP is one of the most stable public pension plans in the world. Changes over the past many years has made the plan sustainable for at least 75 years as it currently has over $576 billion in assets and has averaged a 10-year annualized return of 10 per cent. Those are statistics that put it right near the top for public pension plans in the world.

In fact, while there are many institutions these days which Canadians may question in terms of performance and actions that are taken, the Canada Pension Plan isn’t one of them. The fund remains not only well managed, but separate and apart from government operations.

As I stated in my comments in the Manitoba Legislature when speaking to this government motion, part of the concern with the conversations happening in Alberta is it may cause those who are the most vulnerable to worry about their pension plan. While the Canada Pension Plan was not intended to be the sole source of income for most retirees, it was designed to ensure that a portion of retiring Canadians income could be replaced after a lifetime of personal and employer contributions. But I also know, having spoken to countless seniors during my elected life, that many worry about the stability of the CPP and thus their pensions. The discussions out of Alberta may unnecessarily cause seniors to worry about how strong the CPP is despite its solid financial basis.

Of course, the proposed withdrawal by Alberta is far from a sure thing. Recent polls indicate that the majority of Albertans value the CPP and don’t want to leave the fund. Alberta has the right to speculate it may wish to withdraw from CPP and ultimately has the legal right to do so with the proper notice and agreed upon terms. But the right to do so doesn’t make it right. And the broad speculation can cause both anxiety and distrust in a program that many seniors and vulnerable Canadians rely upon.

There is also a suspicion that this really has little to do with CPP and more to do with the concerns that Alberta has with the federal Liberal government on a host of other things such as the federal carbon tax and energy policies. Those concerns I think are very understood by many Canadians. Based on recent polling, there are many Canadians who are concerned about the direction the country is going under the current federal Liberal government. But using CPP as a wedge against the federal government, if that is in fact what is happening, is a strategy that causes too much damage to something that is working well.

In the end, there is a good chance that Alberta will not proceed with exiting the CPP. And there is also a good chance that after the next federal election there will be a new government. And perhaps then these issues get look at in a different context. But regardless, it is important for Canadians to know that the Canada Pension Plan and its stability is not what is being called into question in this latest dispute between Alberta and Ottawa.