Employers are not on board with a made-in-Ontario pension plan.
A report released at the end of March from the Ontario Chamber of Commerce and Certified General Accountants of Ontario revealed that employers do not support a provincially-made pension plan. Instead, management groups preferred Pooled Registered Pension Plans (PRPPs) as a means to better prepare for retirement, according to the report, An Employer Perspective on Fixing Ontario’s Pension Problem.
“Employers recognize that there are no quick and easy fixes,” said Allan O’Dette, president and CEO of the chamber of commerce. “Ontario’s pension problem requires a long-term perspective and a comprehensive solution that results in seniors having adequate replacement income when they retire. Employers felt that PRPPs were the best solution to helping Ontarians save more.”
A PRPP is a workplace pension managed and regulated by third-party financial service providers and are targeted specifically to small and medium businesses.
The study (which surveyed about 1,000 companies and hosted seven roundtable discussions), noted employers worry the current proposed pension system in Ontario is unsustainable.
Of particular concern was that pension reform could diminish Ontario’s long-term competitiveness and should target those who need assistance. As well, any reforms should be Canada-wide, not province-specific — for fear changes could further fragment and complicate the pension landscape.
Eighty-six per cent of employers surveyed supported introducing PRPPs in Ontario, and far fewer supported enhancing the Canada Pension Plan or an Ontario pension plan.
For Ontario to keep long-term economic prosperity, its soon-to-be large cohort of retirees must maintain their purchasing power, the report concluded.
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