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  • CCPA SK Annual General Meeting October 11, 2019
    Please join us for our Annual General Meeting in Saskatoon, 5:00pm, Thursday, October 24th at Station 20 West. (1120 20th St. West) Courtney Carlberg, author of Saskatchewan's Failing Report Card on Child Care, will discuss why Saskatchewan ranks the lowest for overall quality and rates of access to regulated child care in the country and […]
    Canadian Centre for Policy Alternatives
  • Corporate Mapping Project receives award for research excellence October 9, 2019
    The co-directors of the Corporate Mapping Project—CCPA-BC Director Shannon Daub and the University of Victoria’s William Carroll—are being celebrated in Victoria today as they accept a REACH Award for Excellence in Research. The REACH Awards recognize “research excellence” as demonstrated through scholarly contributions and societal impact. Since the inception of the Corporate Mapping Project, Shannon […]
    Canadian Centre for Policy Alternatives
  • Unpacking the details of Manitoba Hydro September 9, 2019
    What would a long view of Manitoba Hydro all entail.  Read report here.
    Canadian Centre for Policy Alternatives
  • CCPA submission to Treasury Board consultation on regulatory modernization September 6, 2019
    On June 29, 2019, the federal government launched a public consultation on initiatives intended to "modernize" the Canadian regulatory system. Interested Canadians were invited to provide input on four current initiatives: Targeted Regulatory Reviews (Round 2) Review of the Red Tape Reduction Act Exploring options to legislate changes to regulator mandates Suggestions for the next […]
    Canadian Centre for Policy Alternatives
  • Join us in November for the 2019 CCPA-BC Gala, featuring Nancy MacLean September 3, 2019
    Tickets are available for our 2019 Annual Gala Fundraiser, which will take place in Vancouver on November 21. This year’s featured speaker will be Nancy MacLean, an award-winning historian and author whose talk, The rise of the radical right: How libertarian intellectuals, billionaires and white supremacists shaped today’s politics, is very timely both in the US and here in […]
    Canadian Centre for Policy Alternatives
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The Progressive Economics Forum

The Banks and Supplementary Public Pensions

The Canadian Bankers Association are deeply opposed to meddling with a pension system which they say is working just fine.  Which is understandable, albeit self-serving, given their dominance of the high fee mutual fund industry and the significant profits earned on spreads between low interest GICs and bank lending. The banks do just fine out of leaving individuals without decent pension plans to fend for themselves as investors in the financial markets they dominate.

They go on to say that, if governments sponsor any new pension plans along the lines suggested by three provincial pension inquiries ,” it must be made clear that the government is not providing any guarantees with respect to portfolio balances, rate of return or income stream.”

That is deeply hypocritical, given recent federal government backstops for the banks themselves.
Under the Extraordinary Financing Framework introduced to deal with the global financial crisis, the federal government offered to swap rock solid government bonds for up to $125 Billion of bank held mortgages, and the Bank of Canada allowed the banks to borrow dollar for dollar against risky, hard to sell assets. It is inconceivable that any Canadian government would ever let a major bank fail.

I guess the message is that it is okay for the government to backstop the banks, but not the pension savings of working Canadians.

Enjoy and share:


Comment from rcp
Time: April 30, 2010, 6:22 am

The report is kind of interesting, for a couple of reasons.

1) At the bottom of page 6, the report obliquely acknowledges that some (I’d say most) Canadian mutual funds have high expenses. This may be a first from the CBA.

2) Starting on page 9, there is discussion of potential amendments to the Income Tax Act to allow for third-party-sponsored pension plans. This would be a substantial policy change and could lead to better pension coverage.

There are also some suggestions for RRSP’s and TFSA’s (increase contribution limits, make them more flexible), but these are pretty obvious and we didn’t need the CBA to tell us that.

Comment from Keith Newman
Time: April 30, 2010, 10:19 am

The reality is that the main function of our private pension schemes – private pension plans of all sorts (defined benefit and contribution), RRSPs, TFSAs – is to provide subsidies to the financial industry and advisers. Expecting people to speculate in financial assets for 50 or 60 years to provide for their retirement is absurd and only serves the purposes of those who provide the instruments and advice.

Providing income to the elderly is a matter of distribution between age cohorts alive at any point in time and would best be done through direct federal government spending and taxation. No banks, no financial advisers, one actuary, no fees.

The people currently employed in those areas could be redeployed to more useful jobs, although a few would still be needed to cater to the well-to-do.

Comment from pensions
Time: April 30, 2010, 9:07 pm

On delaying the payment of annual pension increases until a retiree reaches age 65, and then limiting those payments to the first $35,000 in retirement pay. The House approved a deficit-cutting plan earlier this month that relied.

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