Letters to the Editor

Where is the pension money going to come from?
|Canadian HR Reporter|Last Updated: 04/25/2006

I’m with you in questioning how appropriate the United Kingdom recommendations for pension reform would be in Canada (See

“Hard questions about retiring easy,”


“A blueprint for global pension reform,”

March 27, 2006.)

I certainly do not understand how Keith Ambachtsheer could support or recommend that smaller, private employers be legislated into increasing their contribution to employee pension funding to eight per cent (4.95 per cent for Canada Pension Plan (CPP) plus three per cent). Just where is that money going to come from? What does it say to employees whose companies have been providing retirement funds at one per cent or two per cent all along? That they’ve been working for cheapskates all these years?

There’s also a missing piece of information that I’d like someone to calculate for me: How much “per unit” are we paying for the government to administer the CPP? Are we sure it’s under the 0.3-per-cent ceiling recommended for the proposed pension agency?

Speaking of agencies, why would we want two separate bureaucracies, government and pseudo-government, doubling the administrative burden on employers? If there is concern about the shrinking availability of private-sector pension plan coverage, governments need to look at their own part in causing it.

We wrapped up our registered pension plan Dec. 31, 2005, in favour of other compensation. The reason: unreasonable administrative and reporting requirements of the Financial Services Commission Ontario and the Canada Revenue Agency. When an employer organization of 120 people is subjected to the same reporting scrutiny as GM and the Teachers’ Federation, it becomes a disproportionate and onerous administrative obligation.

No more Form 7. No more SIP&P. No more PAR slips or issuing revised T4s. I gleefully completed my 2005 Annual Information Return last week, knowing that it was my last. But I did not chuckle when I read the accompanying update memo. I find it somewhat galling whenever a government body demands that I supply them with information and then charges me a fee for the privilege of doing so. This piece proudly stated that for the first time in more than 10 years, the fees for filing were being increased. Why would any company, regardless of size, want to undertake the responsibility or liability of a registered pension plan in this legislative environment? It seems once again, that in its zeal to be protective, the government is disenfranchising the people it claims it wants to protect.

Now a well-meaning Mr. Ambachtsheer is recommending that since government has discouraged private employers from helping their employees with retirement funding, government should legislate them back into participating.

Jeannie McQuaid
Supervisor, Human Resources
Belshield Enterprises Ltd.
Belleville, Ont.

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