Canadian Labour Congress

Canadian Labour Congress

February 26, 2005 09:00 ET

Retirement Income: Canadians' Worries Ignored

Attention: Assignment Editor, Business/Financial Editor, Lifestyle Editor, News Editor, Government/Political Affairs Editor OTTAWA--(CCNMatthews - Feb. 26, 2005) - As Canadians get nearer to the March 1 deadline for contributions to RRSPs, the Canadian Labour Congress releases a paper on pensions. The statement "Workplace Pensions: Current Difficulties and Going Forward" proposes solutions after a survey of the sorry state of public debate on pensions in this country as our population ages. It is also a renewed call on the federal government to provide leadership to reassure Canadian working citizens about their prospects when they retire.

"Canadian working citizens had their concerns ignored by the federal budget, introduced earlier this week," comments Ken Georgetti, president of the Canadian Labour Congress. "Instead of addressing the real issues the government chose to raise contribution limits - a measure that will benefit only the few high earners that can afford to put away $22,000 every year."

With "Workplace Pensions: Current Difficulties and Going Forward," the Canadian Labour Congress re-opens the debate on pensions.

Among other things the paper explains:

• As a source of retirement income, RRSPs expose plan members to high degrees of risk. Our studies show it is hard to predict their income potential. They also demand more administrative costs from members.

• 80% of union members belong to workplace pension plans compared to just 26% of non-union members.

• Around 1992, for the first time in decades, the percentage of employed people who belong to workplace pensions started declining, moving from 49% to 44% in 2002. In the same time frame, the portion of all members of workplace pension plans who belong to defined benefit plans dropped from 90 to 83%.

• One of the lessons of the recent past is that we need to reconsider the balance between workplace arrangements and public pension programs (OAS and C/QPP) in the delivery of retirement income.

"When poll after poll tell us that three out of four Canadians worry about having enough money to live when they retire, these are the hard realities the federal budget failed to address," added Georgetti.

Among the ideas advanced by the Canadian Labour Congress, there are: strengthening the position of OAS/CPP in the balance between public pensions and other sources of retirement income, lifting the limit under the Income Tax Act on the surplus that can accumulate under a defined benefits pension plan; creating a scheme of insurance for pension plans in all Canadian jurisdictions (one presently exists in Ontario); and, giving pension contributions and/or actuarial deficits secured creditor standing in bankruptcy situations.

"Once again, the 3-million members of the Canadian Labour Congress call on the Prime Minister to appoint a cabinet minister to take charge of these issues and provide badly-needed leadership.

The Canadian Labour Congress, the national voice of the labour movement, represents 3 million Canadian workers. The CLC brings together Canada's national and international unions along with the provincial and territorial federations of labour and 137 district labour councils. Web site: www.clc-ctc.ca /For further information: Jeff Atkinson, 613-526-7425 or 613-863-1413/ IN: ECONOMY, FINANCE, LABOUR, POLITICS, SOCIAL

Contact Information

  • Jean Wolff, Director of Communications Department, Canadian Labour Congress
    Primary Phone: 613-526-7431
    Secondary Phone: 613-878-6040
    E-mail: communications@clc-ctc.ca