ENHANCING CPP

Finance ministers reach an agreement in principle to revamp the Canada Pension Plan

VANCOUVER — Most of Canada’s finance ministers reached an agreement in principle to revamp the Canada Pension Plan, although Quebec and Manitoba have not signed on to the deal.

Under the agreement, which would go into effect in 2019, an average Canadian worker earning about $55,000 will pay an additional $7 a month in 2019. That would increase to $34 a month by 2023.

Once the plan is fully implemented, the maximum annual benefits will increase by about onethird to $17,478.

Finance Minister Bill Morneau said the deal will improve the CPP in a way that will make a difference to working Canadians.

“We have come to a conclusion that we are going to improve the retirement security of Canadians, we’re going to improve the Canada Pension Plan that will make a real difference in future Canadians’ situations,” he said Monday after a meeting with his provincial counterparts.

Morneau said Quebec, which has its own pension plan, and Manitoba continue to be part of the process, despite not signing on to the agreement.

“Quebec is in a different situation,” he added. “The Quebec pension plan is a different vehicle. The costs are different than the Canadian Pension Plan. The idea that more analysis is required is something that we completely understood around the table.”

For Manitoba, Morneau said the deal comes too soon for the province’s new Tory government.

“Manitoba is a brand new government. They’ve been in power for four weeks, so they were a productive voice around the table, a voice of continued interest in working together, but of course this comes pretty fast and hard for them.”

Ontario Finance Minister Charles Sousa said young Canadians will reap the benefits from Monday’s decision.

“Today, this federal government has shown great leadership and great desire to do something of great benefit for our young people.”

Sousa said the plan would replace the one his government had been working on. This means Halton MPP Indira Naidoo-Harris will see a change to her new cabinet job. In last Monday’s cabinet shuffle she was made Associate Minister of Finance responsible for the Ontario Retirement Pension Plan.

British Columbia Finance Minister Mike de Jong, who had reservations about expanding the CPP, said he came on board because the plan is affordable for employees.

“I think we have reached a balanced approach to setting the objectives that were set out.”

A change to the CPP needs the consent of Ottawa and a minimum of seven provinces representing at least two-thirds of the country’s population. Heading into Monday’s federal-provincial meeting, it was still unclear whether Ottawa would piece together the minimum required provincial support for change. Saskatchewan, for example, did not support CPP enhancement. Sources say Ottawa made a major 11th-hour push in hope of securing enough country-wide support to boost the CPP and suggest Prime Minister Justin Trudeau was involved in the extra effort.

We are going to improve the retirement security of Canadians. BILL MORNEAU FEDERAL FINANCE MINISTER