MP Kramp on pooled pension plans

Protecting the Pensions of Canadians
I know many seniors have been asking one question recently – will my Old Age Security cheque stay the same?
Many Canadians close to retirement have also been asking whether Old Age Security will be there for them when they reach 65.

The answer to both questions is yes.

Our Government is committed to protecting retirement income for today’s seniors, and for future generations of retirees. Canadians receive retirement income from a variety of sources, including the Canada Pension Plan and Old Age Security.  The Canada Pension Plan is funded by premiums from each of our paycheques and it is on a safe, secure, and sustainable path.  Old Age Security, on the other hand, is funded from general government revenue and is not sustainable in its current form.

In 1975 there were seven working taxpayers for every senior.  Because our population is getting older, today there are only four working-age Canadians for each senior.  By 2030, the total number of seniors will nearly double, leaving only two working-age Canadians for each senior.  Amidst these changing demographics, the annual cost of the Old Age Security program is projected to increase from $36 billion in 2010 to $108 billion in 2030.

If changes are not made to the Old Age Security program, it will become unsustainable in the long-term.  Failure to make important decisions now will put the program in jeopardy for future generations.

I can guarantee you that any changes to Old Age Security will never affect anyone currently receiving benefits, nor will they ever affect any individual now nearing retirement.  Other Canadians, who are not near retirement, will receive substantial notice of changes to Old Age Security, to ensure they have ample time to plan for their future.

Our Government will take responsible action to ensure financial stability for future generations of seniors and give them confidence that Old Age Security will be sustainable and available to them in their retirement.

Daryl Kramp
Member of Parliament
Prince Edward-Hastings

NOTE: MP Kramp stood in the House of Commons last Tuesday to deliver a speech on the Pooled Registered Penion Plans.
“Canada’s seniors will have the retirement that they deserve with the implementation of this kind of plan”, said Mr. Kramp.

PRPPs are the outcome of several years of cooperation, research and consultations by Canada’s finance ministers on the best ways to ensure the sustainability and strength of Canada’s retirement income system.

“I was in business for 35 years. I only wish that 35 years prior to me starting I had something like this to offer not to only my family but certainly to my employees, as certainly many of us would not be sitting in challenging situations today without an option. This would enable owners and employees alike to have access to a large-scale, low-cost private pension plan for the very first time for many of these people”, said Mr. Kramp.

Mr Kramp also discussed the measures taken by the Conservative Government to support seniors:

“We have provided over $2 billion in additional annual targeted tax relief to seniors and to pensioners through measures such as pension income-splitting. That is huge in a riding like mine. I have the second highest concentration of seniors in the province of Ontario, so I well recognize the need for programs moving forward to allow them to have a disposable income. We increased the age credit amount. There was a doubling of the maximum amount of income eligible for the pension income credit. It included reforming the framework governing federally regulated pensions to better protect pensioners.”

His speech concluded by saying:

“Through all of these measures, combined with the government’s determined efforts to make PRPPs a reality, I sincerely believe that we are making a retirement system that is good. Can it be better? Yes. Is it strong? Yes. Can it and should it be stronger? Yes, that is our duty and our responsibility as parliamentarians. This is something that I think we as Canadians, and certainly the Parliament of Canada, can and should be very proud of.”

To see a transcript of the entire speech, go to: http://www.darylkramp.ca/pdf/prppadebate_jan2012.pdf