Flaherty Gets Consensus to Create Private Sector Pension Plan

Critics say the finance minister is setting Canadians up for failure by not increasing premiums for the Canadian Pension Plan.

Federal Finance Minister Jim Flaherty left a meeting with his provincial counterparts Monday with a consensus to create a private pension fund that employees will have the ability to opt out of. But some observers say he didn’t go far enough because he backed down from a mandatory rise in CPP premiums and benefits. Flaherty had championed that idea until last week, when he reversed his position, saying the economy was still too weak to force Canadians to pay higher premiums. The private plan will be available to all workers, including the self-employed, but because it’s voluntary it likely won’t assist those who don’t have much to save. Statistics show many Canadians are not saving enough money for their retirement.