Federal parties promise improved pension coverage and retirement security | National Union of Public and General Employees

Federal parties promise improved pension coverage and retirement security

Main split on pensions comes down to continuing to rely on a failed private sector model, or improving and expanding our public pension system.

Ottawa (26 April 2011) – Reforming Canada’s retirement income system is a major issue being addressed by all three major federal parties in the current election campaign.

All three parties have proposed changes to the current system. The primary difference between them is ideological – whether to continued to rely on private sector to provide workplace pensions, or to improve and expand on our public pension system.

Not surprisingly, Stephen Harper’s Conservatives favour private sector delivery, even though it has failed miserably in providing Canadians with decent pensions – only 38% of the Canadian labour force belong to a workplace pension plan.  Both the NDP and Liberals are proposing an expansion of the Canada Pension Plan (CPP) as the best option to provide improved retirement security for the 10 million Canadian workers who do not belong to a workplace pension plan.

Private national plan versus expanded CPP

The Conservatives are promising to implement its Pooled Retirement Pension Plan (PRPP) which they first proposed late last year.  The PRPP is intended to allow both employees and the self-employed to pay into large defined contribution plans that would be administered by by financial institutions. The proposal, which doesn’t compel employers to contribute, has been entusiastically promoted by the private financial services sector, the primary bebeficiaries of PRPPs.

By contrast, the Liberals are targeting their proposed changes to the public side of the system. Their platform promises a gradual but undefined expansion of CPP benefits.  They also promise a new voluntary defined contribution supplemental CPP, allowing contributions of an additional 5 to 10 percent of gross pay into a CPP backed fund.

The NDP offers the most comprehensive plan which mirrors proposals put forward by the labour movement over the past two years.  New Democrats are committed to doubling future CPP benefits to a maximum of $1,868 a month by gradually increasing CPP contributions over the next seven years.

GIS increases

All three parties are promising to boost the Guaranteed Income Supplement (GIS), which goes to Canada’s poorest seniors. The current average annual GIS payment is $5,400 and about 10 percent of the 1.6 million Canadians who receive GIS collect full annual amount $7,980.

The Conservatives have committed an extra $300 million to bolster the GIS to provide a maximum $600 a year increase to 380,000 seniors. The Liberals and NDP both promise to boost the GIS by $700 million per year. The Liberal’s increase would be spread across 1.6 million seniors who receive GIS and provide them with maximum increase of $650 a year. The NDP $700 million GIS increase applies to 250,000 seniors below poverty line making between $15,000 and $18,000 (about six percent of all GIS recipients). Those individuals would receive an average increase of $2,800 a year up to a maximum $8,000.

Pension protection in the event of bankruptcy

Additionally, the NDP is pledging automatic enrollment in the OAS and GIS for seniors and extension of retroactivity from the current 11 months to 36 months for seniors not receiving entitled OAS/GIS benefits. They have committed to establishing a national agency to adopt workplace pension plans of bankrupt companies as well as a national workplace pension insurance program guaranteeing pensioners a minimum of $2,500/month in the event of bankruptcy and plan failure. The NDP pledges to protect pensioners and workers on long-term disability when companies face bankruptcy and restructuring

The Liberals are also proposing the creation of a new federal agency to help workers with their pensions in the aftermath of corporate bankruptcy as well as more protection for those on long-term disability.


The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE