The CLHIA is coming out swinging at the provincial government over what the Liberals will consider comparable in its proposed retirement pension plan.
The CLHIA “is extremely disappointed” with the Ontario government's suggestion that existing workplace schemes – including DC plans – would not be considered "comparable” in the province’s proposed ORPP.
The government released its consultation paper on Wednesday, outlining a few details which had been scarce up until then, inviting feedback on its proposed new retirement policy.
"This stance would negatively impact DC plans and savings rates not only in Ontario, but across the country," said Frank Swedlove, President and CEO of the Canadian Life and Health Insurance Association. "Employers who took the responsible approach and established these types of plans for their employees would now also be obliged to participate and contribute to ORPPs. In too many cases, we fear that they will either cut back the benefits of their DC plans or abandon them entirely."
The CLHIA argues that contrary to the impressions left by the Ontario government's paper, DC Registered Pension Plans have proven to be an effective way for Ontario workers to save for retirement.
More than 600,000 Ontarians have DC plans at their workplace and many more will be offered this opportunity through the proposed PRPPs.
Further, the average employer contribution for DC plans is 6.5 per cent and the average employee contribution is 4.5 per cent.
"The Ontario government says that their objective is to make Ontarians better off in retirement. The truth of it is that they could be undermining the future well-being of hundreds of thousands of workers who have DC plans and leaving them worse off in retirement," said Swedlove.
The government released its consultation paper on Wednesday, outlining a few details which had been scarce up until then, inviting feedback on its proposed new retirement policy.
"This stance would negatively impact DC plans and savings rates not only in Ontario, but across the country," said Frank Swedlove, President and CEO of the Canadian Life and Health Insurance Association. "Employers who took the responsible approach and established these types of plans for their employees would now also be obliged to participate and contribute to ORPPs. In too many cases, we fear that they will either cut back the benefits of their DC plans or abandon them entirely."
The CLHIA argues that contrary to the impressions left by the Ontario government's paper, DC Registered Pension Plans have proven to be an effective way for Ontario workers to save for retirement.
More than 600,000 Ontarians have DC plans at their workplace and many more will be offered this opportunity through the proposed PRPPs.
Further, the average employer contribution for DC plans is 6.5 per cent and the average employee contribution is 4.5 per cent.
"The Ontario government says that their objective is to make Ontarians better off in retirement. The truth of it is that they could be undermining the future well-being of hundreds of thousands of workers who have DC plans and leaving them worse off in retirement," said Swedlove.
