Prince Edward Island Opposition leader warns of more economic hardship in province
© Guardian photo
If Prince Edward Island signs onto Ontario’s proposed pension plan, Islanders will be facing unwanted economic hardship, says Opposition Leader Steven Myers.
He says Premier Robert Ghiz’s decision to team up with Ontario and Manitoba to develop a provincial plan to supplement the Canadian Pension Plan is “a
payroll tax that no one can afford.”
“How can Ghiz expect to stimulate the economy and create jobs when all he wants to do is take more money from employers and employees?” Myers said.
Last week, Ghiz travelled to Toronto to announce P.E.I. has joined a new
working group that
will study ways to supplement the CPP in order to enhance incomes for retirees.
The initiative is being
led by Ontario, which has said it plans to move ahead with its own pension
plan after Finance Minister Jim Flaherty nixed the
idea of raising CPP premiums.
P.E.I. Finance Minister Wes Sheridan has championed CPP reform, and it’s why P.E.I. is now working with Ontario to explore alternative ways to help seniors put away more money for their retirement.
Ghiz was not available for comment Friday, but a spokesman in his office stressed the province is only involved in a working group struck to examine the issue, and has not agreed to sign onto any new pension plan yet.
“For us, being on the working group is important because it allows us to continue the important work that we’ve done on CPP over the past year,” said Guy Gallant, policy adviser to the premier.
“I think having two provinces sit on the working group shows the federal government that we’re still serious about making sure that retirees have more money in their pockets when it comes time to retire.”
But Myers says he is concerned Ghiz will indeed sign on to Ontario’s pension plan, which would impose pension premiums on workers and employers already feeling financially stretched in P.E.I.
“Islanders are already coping with increased income tax, increased business tax, increased fees and the HST,” Myers said.
“To then take money
off their paycheques would be pouring salt on a
very open and painful wound.”
The Canadian Federation of Independent Business is also raising concern over the possibility of a new pension plan.
“Entrepreneurs in provinces that sign onto such a plan would be at a competitive disadvantage to those in provinces that choose to avoid these new payroll taxes,” says a statement on the CFIB website.
Local CFIB spokeswoman Erin McGrath-Gaudet told The Guardian earlier this week P.E.I. is already one of the highest-taxed jurisdictions in the country and this would
be another blow to employers and workers in the province.
She said the P.E.I. should instead introduce legislation to allow small businesses to take part in Pooled Registered Pension Plans (PRPPs), which would be a voluntary option to help Islanders save more for their retirements.
“We haven’t seen P.E.I. going down this road yet, which is a concern to us,” McGrath-Gaudet said.
“They may not be government’s version of what’s perfect, but they’re certainly good and they’re an improvement so we would certainly ask government to start moving down that road in the immediate future regardless of what other roads they want to travel down.”
In the coming weeks Ontario plans to release its plans about how it will roll out its own provincial pension plan – one that will be similar to CPP.
Gallant said P.E.I. will
not be part of that plan when it is announced, but will continue to discuss the issue as part of Ontario’s working group together with Manitoba, which
has also signed on to the group.