Surveys tend to ask more questions than you typically care to answer, but when it comes to the provincial government’s online questionnaire on the idea of creating an Alberta Pension Plan, I found that it doesn’t ask enough.
More specifically, it doesn’t pose the money question, the one at the heart of the matter: Are you in favour of Alberta withdrawing from the Canada Pension Plan?
Given that’s what’s on the table, you’d think it would be an obvious question to include, but when I took the survey last week, it never popped up, presumably because the government doesn’t want to know the answer.
I can’t say I’m surprised because ever since this idea was floated to the public, the government has been putting a best-case scenario spin on the issue, which makes me suspicious about what could otherwise be a sound initiative.
Because of its younger workforce and fewer retirees, Alberta has, for decades, paid more into the CPP than it receives on an annual basis, so creating its own pension plan could theoretically produce higher payments for seniors and/or lower payroll deductions for employees/employers.
The government’s online survey makes sure to highlight this potential windfall, asking how these savings should be used. Pensioners are presented with the prospect of a higher monthly cheque or a one-time "bonus" when they retire (including those who are already retired) and employees/employers with a decrease in payroll contribution rates.
It sounds like an APP would benefit both the young and the old, so what’s not to like, but as much as the demographics are in our favour, I get nervous because of the way the provincial government is approaching this whole thing.
It commissioned a consultant to produce a report on the issue, and like many documents created through such relationships, this one came up with numbers that were to the province’s liking. The report contends that Alberta is entitled to $334 billion if it withdraws from the CPP, which is a whopping 53 per cent of the plan’s assets. Not surprisingly, many have disputed such a significant figure, with a University of Calgary economist pegging it closer to $120 billion.
The consultant’s report also contends that Alberta could see $5 billion in savings in its first year, a number the economist, who has no skin in the game, says is more likely to be $1.5 billion.
Between the report and the survey, I get the feeling we’re being fed a one-sided, rose-coloured take on the issue, which makes me suspicious even though the underlying premise has merit. There’s no doubt that for a lifetime of contributions, CPP’s returns are modest at best, but having said that, people who have paid into the plan for their whole working lives deserve straight talk, not spin geared toward a particular outcome.
It’s worrisome to think this issue could be just another salvo in this government’s ongoing feud with Ottawa, which isn’t where you want your pension to end up.
If an Alberta Pension Plan is the way to go, the government must do a better job of providing unbiased information on which we can make a decision.
