Playing roulette with your retirement

This past week saw the unveiling of the new Conservative plan for pensions in Canada.
As you can imagine, my NDP colleagues and I have something to say about this Conservative “plan” and have a different view of what needs to be done to secure the retirement income of all Canadians moving forward.
New Democrats always have believed that after a lifetime of hard work, you deserve to know you’ll be able to retire comfortably when the time comes. It’s the way it should be, but increasingly it is the way it used to be.
Some 11 million working Canadians now have no workplace pension and as life gets more expensive, most individuals and households can’t save enough to go it alone with stock purchases, RRSPs, or other investments.
Almost every day I hear from another constituent who’s deeply worried about their future retirement.
Yet Stephen Harper and his Conservatives are leaving families to face the retirement crisis alone–even with their “new” plan. Harper’s new policy does nothing more than double down on the same private investment funds that already are failing so many Canadians.
Harper’s “plan” that was unveiled earlier this month is being called the “Pooled Registered Pension Plan.” It’s like a group RRSP that employers now may offer instead of defined-benefit workplace pensions.
In other words, Mr. Harper wants you to pump even more of your savings into risky private funds and stock markets—and just when they are more volatile than ever before in our lifetime.
If you’ve watched the value of your RRSPs tumble, or heard about others whose savings plunged along with the stock market in recent years, then you know how risky this approach can be.
Private funds also are burdened by high management fees that make the fund managers wealthy but drain as much as 50 percent of your contributions over a lifetime.
In 2007 alone, before the recession hit, RRSP holders lost a whopping $25 billion—with a ‘b’–to management fees. Not bad at all . . . for the banks and fund managers, that is.
In times like these, I don’t think we should be looking to pay more fees and signing up for more risk while trying to secure our retirement. We all deserve a secure retirement plan that offers peace of mind to your family—not just to fund managers.
That’s why, instead of asking you to play roulette with your retirement, New Democrats have a plan to increase your guaranteed public pension. It’s an old idea, but one that has served us well.
We call it the Canada Pension Plan.
Forty-five years ago, New Democrats helped launch the Canada Pension Plan (CPP). It is rock-solid, low-cost, and inflation-protected so we don’t have to worry about management fees, the decline of the stock markets, or anything else.
You pay into the plan, and the money is invested in stable and non-risky vehicles overseen by a board of directors, whose only job is to make sure there is enough in the kitty to pay a set amount out to each Canadian each month after they retire.
No fees, little risk, and stable and predictable payouts.
New Democrats are proposing a plan to double our CPP benefits gradually over time, to a maximum of $1,920 per month.
We all know that nothing is free, but a small increase in what we have taken off of our paycheques each week will ensure the extra money is there when we retire–just as the standard CPP payment always has been.
We hardly notice the contribution we make from our paycheques now, so a small increase will continue to have little impact on our day-to-day income while providing for a safe, secure, and affordable retirement later.
Look, we know the global economy is headed for rough waters and we also know Canada is not immune from the problems being experienced abroad. With all this going on, Stephen Harper thinks millions of Canadians should have to gamble their income to win the right to retire in dignity while New Democrats are fighting for a plan that offers every Canadian guaranteed peace of mind.
When it comes to your retirement, what would you rather do: gamble or take the sure bet?

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