WINNIPEG — Manitoba does not support a national agreement on boosting the Canada Pension Plan in part because it does not address the need for people to set aside their own retirement savings, Premier Brian Pallister said Tuesday.
"I guess what I'm talking about is making sure we don't lose sight of individual responsibility in the hoopla around debating the CPP augmentation here," said Pallister, who worked for decades in insurance and financial planning.
"I want to make sure that all Canadians understand that their management of their discretionary incomes, and their willingness to set aside today's spending for tomorrow's investments in their own future, is the key way that they're going to secure their financial future."
Manitoba Premier Brian Pallister speaks to media before the provincial throne speech at the Manitoba Legislature in Winnipeg, Monday, May 16, 2016. (Photo: John Woods/CP)
Manitoba abstained from the vote Monday in Vancouver that saw all finance ministers from every province except Manitoba and Quebec endorse, in principle, an increase in both CPP premiums and benefits.
The deal, which is to be finalized next month, is to be phased in starting in 2019. By 2023, an extra $34 a month in pension premiums will mean up to $4,300 more in annual retirement benefits for the average Canadian wage earner.
The maximum annual benefit is to increase by about one-third to $17,478.
Employers will see their premiums increase as well — a move that has some business groups warning of job cuts.
Pallister said part of the reason Manitoba abstained is because his Progressive Conservative government was elected only two months ago and is still studying the issue.
"I guess what I'm talking about is making sure we don't lose sight of individual responsibility in the hoopla around debating the CPP augmentation here."
But he also cited a desire to leave people with more discretionary income for their own savings plans following tax increases in Manitoba under the previous NDP government. The enlarged CPP would remove even more discretionary income through higher premiums.
"There are many studies that show when compulsory savings plans are introduced, and when they're augmented, that the result is people save less in optional forms and no one is any better off."
New Democrat finance critic James Allum said Pallister is siding with big business instead of working families who are worried about their retirement.
"We think the ... agreement-in-principle is affordable. It will be phased in over time," he said.
Pallister acknowledged the agreement can go ahead without Manitoba's approval. It only needs support from seven provinces representing at least two-thirds of the country's population.
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