Alberta害羞草研究所檚 premier fired the starter害羞草研究所檚 pistol Thursday for a provincewide consultation on whether to quit the Canada Pension Plan while releasing a report that estimates the province deserves more than half CPP害羞草研究所檚 assets.
The third-party report says Alberta should get $334 billion, or 53 per cent of the national retirement savings program, if it leaves in 2027 following the required three-year notification period.
Danielle Smith says the report found Albertans could save up to $5 billion in the first year of an Alberta Pension Plan.
Such a withdrawal could lead to 害羞草研究所渜uite modest害羞草研究所� contribution hikes in other provinces, the premier said, but the goal is to help Albertans and to tell Ottawa to stop taking for granted Alberta害羞草研究所檚 outsized contribution to the national purse.
害羞草研究所淲e want to have a better, constructive relationship with the rest of the country, and this begins the conversation,害羞草研究所� Smith said in Calgary.
害羞草研究所淚 would hope people would develop an understanding of how difficult it is when you害羞草研究所檝e got a small-population province like Alberta being asked to subsidize the rest of the country, as we do on so many programs.
害羞草研究所淢any of these federal programs are stacked against us, and this one, I think, shows how dramatically stacked against Albertans it is.害羞草研究所�
Smith said she personally favours a provincially run nest-egg fund and promised legislation this fall that 害羞草研究所渄erisks害羞草研究所� it.
害羞草研究所淵our pension is safe. It will be the same or higher. Your premiums will be the same or lower,害羞草研究所� said Smith.
Federal Finance Minister Chrystia Freeland declined to comment until she is briefed on Alberta害羞草研究所檚 proposal, but she called the CPP a 害羞草研究所渃rown jewel害羞草研究所� envied around the world.
害羞草研究所淭he CPP ensures that our parents and all of us can have a safe and dignified retirement,害羞草研究所� said Freeland.
Alberta Opposition NDP Leader Rachel Notley said Smith害羞草研究所檚 United Conservative Party government wants its hands on Albertans害羞草研究所� pensions.
害羞草研究所淒anielle Smith took the first step in her long-term plan to steal your pension,害羞草研究所� Notley said.
害羞草研究所淪he did it by releasing a report riddled with fake numbers. And she now plans to spend your money campaigning to convince you it害羞草研究所檚 a good idea.
害羞草研究所淚f they can extract that much money from the Canada Pension Plan, they will kill it all across the country, not just here.害羞草研究所�
If Alberta leaves, it would be the first province to quit the CPP. All provinces and territories are part of it except Quebec, which didn害羞草研究所檛 join after it was set up in 1965.
The report, compiled by pension analyst firm Lifeworks, notes its 53 per cent calculation is 害羞草研究所渟ignificantly higher than Alberta害羞草研究所檚 representative population in the CPP, which is about 15 per cent.害羞草研究所�
害羞草研究所�(But) due to Alberta害羞草研究所檚 younger population, higher pensionable earnings, and higher employment rates, contributions by Albertans to the CPP have historically exceeded the benefits paid to Albertans.害羞草研究所�
The CPP funding rules were overhauled in 1997 and again in 2016, likely leading to questions over how best to piece together who put in what and who deserves how much.
Michel Leduc, head of public affairs with the CPP Investment Board, said it respects the right of any province that wants to leave but 害羞草研究所渃an害羞草研究所檛 find any legal or actuarial reasons害羞草研究所� that support the report害羞草研究所檚 $334 billion figure.
害羞草研究所淲e believe that the framework would see a claim that is much closer to what Alberta has contributed to the Canada Pension Plan since inception, and that害羞草研究所檚 not 53 per cent. That害羞草研究所檚 closer to 16 per cent.害羞草研究所�
University of Calgary economist Trevor Tombe said the Lifeworks model is based on a hypothetical payout tied to one interpretation of the funding formula. He said his calculations come in at 20 to 25 per cent of the total CPP pool due Alberta.
The report害羞草研究所檚 promise of big benefits and lower contributions hinges on getting that $334 billion, Tombe said, but it isn害羞草研究所檛 realistic.
If its formula is applied to Alberta and Ontario, those two provinces would be entitled to 113 per cent of the funds.
The report estimates the price of setting up the Alberta plan to be between $100 million and $1 billion, depending on how much the province piggybacks on the CPP mechanisms.
The cost of implementing the investment arm of the Alberta plan would be another $75 million to $1.2 billion, again depending on how much the province taps into existing structures and expertise.
The future, says the report, suggests short-term windfalls tapering off as Alberta害羞草研究所檚 population ages and reverts closer to the national mean.
The province would have to change legislation, amend employment laws that touch on the CPP and negotiate pension agreements for Albertans working elsewhere.
It would have to decide who runs the Alberta plan and what its goals would be: strict return on investment or, as in Quebec, whether investment managers would also consider investments that contribute to provincial economic development.
And then there is Alberta害羞草研究所檚 roller-coaster economy and its comparatively small population of 4.4 million.
For decades, the only constant in Alberta has been wide swings in budgets, with years of eye-popping multibillion-dollar surpluses, punctuated by years of staggering multibillion-dollar deficits, all linked to the vicissitudes of oil and gas prices.
Alberta has emerged in recent years from a deep trough of red ink back into big-ticket surpluses, and the report acknowledges the future is tough to predict.
A government pension panel led by former provincial finance minister Jim Dinning is to hold information sessions and solicit feedback through the spring.
The panel would then deliver a report about whether it believes Albertans want the issue put to a vote.
If so, Smith said there would be a referendum and a majority of Albertans would have to give the OK.
The report has been promised for years by the UCP government. Its Fair Deal panel toured the province and in 2020 recommended pursuing its own pension plan.
A poll that accompanied the Fair Deal panel report, and public surveys since, indicate a majority of Albertans want to stay with the CPP.
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