British think tank is calling on the government to double the size of pensions and increase the retirement age to 68.
A report from the Adam Smith Institute said the pension should be increased to 40 per cent of average earnings, up from its current level of 20 per cent and, in some cases, 15 per cent, according to a report in the
The report said the current pension scheme costs the government about $167 billion Cdn per year, equivalent to about seven per cent of gross domestic product. Doubling the pension would increase the cost by about $95 billion Cdn, but the institute said about $24 billion Cdn could be saved for each year people had to wait before they became eligible for the pension.
In addition to bumping benefits and the retirement age, the report calls on the government to put incentives in place to encourage employers to set up their own pension plans and re-train older workers to keep them in the workforce. It also wants the government to stop micro-managing pensions and ease tax rules and regulations on pensions.
“We believe that these carefully constructed proposals provide, at last, a firm foundation for politically deliverable pension reform that will actually get the nation saving again,” said Matthew Young of the Adam Smith Institute.