Ontario has a pension problem: too many Ontarians will not have enough money when they retire.
Employers in the province are concerned. There are clear moral imperatives for ensuring that Ontarians are able to maintain their standard of living late in life. There are also clear economic imperatives. The long-term economic prosperity of Ontario hinges on the purchasing power of the large cohort of future retirees. The long-term fiscal health of government is contingent on limiting the number of seniors reliant on taxpayer-funded income assistance.
The Government of Ontario is considering both a government-managed and a private sector solution to Ontario’s pension problem. The former proposal is an enhancement of the existing Canada Pension Plan (CPP) or the introduction of a new Ontario Pension Plan (OPP). The latter proposal is the introduction of Pooled Registered Pension Plans (PRPPs), which are managed by regulated financial service providers.
In January and February 2014, the Ontario Chamber of Commerce (OCC) and the Certified General Accountants of Ontario (CGA Ontario) partnered to consult employers on these proposals and solicit their views on Ontario’s pension future.
This paper reflects the results of these consultations. We found that employers want solutions that support rather than impede our long-term competitiveness, that are targeted to those groups that require additional pension support, and that build on the province’s status as a global leader in financial services. Weighed against these and other objectives, employers are firmly in favour of PRPPs. They are much less supportive of enhancing government-managed programs.
Employers recognize that there are no quick and easy fixes. Ontario’s pension problem requires a long-term perspective and a comprehensive solution that results in seniors maintaining a good quality of life after retirement.