UPDATE- Not the time to bolster Canada Pension Plan: federal-provincial ministers

The Canadian Press ~ staff The Guardian
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Jim Flaherty and Wes Sheridan

P.E.I. Finance Minister Wes Sheridan says the federal government shut down a plan Monday agreed to by the provinces and territories to continue to explore the idea of boosting the Canada Pension Plan by raising premiums.

In a telephone interview with The Guardian following a meeting with his federal and provincial counterparts Monday, Sheridan said the provinces and territories had reached a consensus.

“We had made a proposal that we would have an independent third party go out and continue to look at CPP and make sure that we had full understanding of what the impact would be on families, business and all Canadians,” Sheridan said.

“The federal government is saying unilaterally that they do not agree with a CPP enhancement and they don’t have any intention of ever doing it. Period, end of story.”

That’s why Sheridan now says provincial finance ministers are now taking the next 24 hours to determine how best to respond.

He says what happens next could be very interesting.

“I don’t know if there’s ever been a time where the provinces and territories have been in such a different position than the federal government.”

Sheridan’s proposal to enrich the CPP would see contributions for both workers and employers hiked in order to double the current maximum payout of $12,150 a year.

This would require a 3.1 per cent increase in contributions for those earning between $25,000 and $51,000 a year.

The plan would also see the maximum insurable earnings cutoff raised to $102,000 from its current cutoff of $51,000.

This would extend the amount of premiums paid into the plan, contributing to the larger eventual payout.

Going into the meetings Monday, Sheridan said he would be willing to push back the phase-in period for these changes by several years in order to get Quebec’s onside.

Despite the consensus reached among the provinces and territories to continue to explore this plan, Federal Finance Minister Jim Flaherty and secretary of state for finance Kevin Sorenson emerged from the meetings Monday saying now is not the time to raise payroll taxes to pay for higher pensions.

Sorenson said higher pension premiums would mean lost income and lost jobs.

Ontario’s finance minister, Charles Sousa told reporters his province is now prepared to go it alone with pension improvements.

Sheridan says he and his other counterparts will take the next day to decide whether they too will move forward without the feds.

“What I would like to see happen is that all parties would reconsider and we would go out and do this type of independent study that would result in a real path forward,” Sheridan said, adding his displeasure at Flaherty and Sorenson’s actions Monday.

“It’s very disappointing in the way that they’ve managed their message. But I’m not disappointed in (the provinces and territories). I’m proud to be part of that team and we’ll continue to try to do what’s right for Canadians.”

With files from The Canadian Press.

twright@theguardian.pe.ca

Twitter.com/GuardianTeresa

Geographic location: OTTAWA

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  • dreaming liberals
    December 17, 2013 - 10:20

    What? Wes and the provincial premiers wanted the maximum CPP insurable earnings increased to 102,000. Who makes that kind of salary? Oh, the Premier and MLA's. Yep, if they get to 65 and can't afford to live, they have NO excuse, particularly given the families who scrape by on 20K or less in this province. Or, did they want CPP receipts increased so that they could properly fund the "underfunded" pension plans of public service employees that came about as a result of misguided political policies? Either way, they all needed to be sent packing with a firm message -- it's long overdue that provinces become fiscally responsible with taxpayers $$'s that favour ALL constituents and not just the chosen few.

  • dreaming liberals
    December 17, 2013 - 10:19

    What? Wes and the provincial premiers wanted the maximum CPP insurable earnings increased to 102,000. Who makes that kind of salary? Oh, the Premier and MLA's. Yep, if they get to 65 and can't afford to live, they have NO excuse, particularly given the families who scrape by on 20K or less in this province. Or, did they want CPP receipts increased so that they could properly fund the "underfunded" pension plans of public service employees that came about as a result of misguided political policies? Either way, they all needed to be sent packing with a firm message -- it's long overdue that provinces become fiscally responsible with taxpayers $$'s that favour ALL constituents and not just the chosen few.

  • Garth Staples
    December 17, 2013 - 09:37

    So the tax and spend Liberal Minister met someone with blood in his veins who said no to more taxes on our future. When PEI has a surplus that is the time to invest in future pensions. Only in PEI does the Liberal Govt make 'mountains' out of molehills in Borden.

  • Ah Wessie
    December 17, 2013 - 07:45

    Wessie, if you want something it means it is not a good thing for islanders...so glad you got turned down. I agree with others on here - you got a free vacation on our dime. RE CALL RE CALL RE CALL SHERIDAN & GHIZ. LET US THE VOTERS SAY WHEN THE NEXT ELECTION IS -AND WE SAY WE WANT ONE IN 2014.

  • Take a hike Wesley
    December 17, 2013 - 07:36

    Haha Wes.......they told you to beat it back to PEI....it's the only place where you can run your dictatorship.

  • waldorf
    December 17, 2013 - 06:54

    Wow P.E.I. Finance Minister Wes Sheridan (aka Ned Flanders) really made us proud.... The Awaken of the Financial Genius .You made Shediac proud Wes please go back there before you bankrupt our island..........

  • Ha--ha==ha
    December 16, 2013 - 22:14

    Well, this is one time you didn't get your own way to continue to rob the people,Sheridan. It is near time people are catching on to you!!!!!

  • AD
    December 16, 2013 - 18:27

    While I very rarely agree with anything our current government does, I have two parents cruising into retirement with not a dime of personal savings and no plan. They will rely completely on CPP and other income they will obtain by working well past 65 just to keep afloat. In areas like PEI, this is not rare; rather it is the norm. We can't just continue to 'kick the can down the road' as it were. If not this then what? Like it or not, we are not American where it's fend for yourself. I will never access the EI system due to the type of work I do but I do not complain about contributing to it. Same with CPP - I expect to have a reasonable pension and contribute to my own RRSP plan and save over and above these. Although I do not expect to rely on CPP, I wholeheartedly agree that it should be available for those who've paid in, but should ensure that it's a livable income. If not this plan, then what? Everyone complains that it's not going to exist anyway - if we do nothing, it will be a self-fulfilling prophecy.

    • wog
      December 17, 2013 - 12:58

      Agreed. Demographics are a ticking time bomb in this country and the later you put off addressing it, the harder it will be to solve. One can apply means testing to determine if a person needs it, but I don't understand the reluctance in forming a long term strategy. When it came to the Canada Post (crown corporation)...solvency was addressed agressively enough.

  • Finally
    December 16, 2013 - 16:57

    Finally someone has Wes's number and realizes just how bad he is with finances . It's so plain to see when looking at PEI's books & listening to him & Ghiz saying whats best for us & not to worry . They have it covered .

    • liberal dong
      December 16, 2013 - 18:37

      What a waste of money for Sheridan to go to Ottawa and shove his potectic ideas to Jim Flarhey,Wes should pay for his mini vacation out of his own pocket...so much for reducing the deficit.

  • don
    December 16, 2013 - 16:25

    i wonder who paid for wes to take a mini vacation? and i bet he did not stay at a low cost motel?

    • You must be joking
      December 17, 2013 - 19:48

      If you have ever been to Ottawa (and I have serious doubts if you have ever left the Island) - you would know that Ottawa is far from Club Med!