Federal Finance Minister Chrystia Freelandsaid Friday that if Alberta were to quit the Canada Pension Plan, it would need to launch a “complex and multi-year process” of negotiating international social security agreements to deal with contributors who work abroad.
Freeland listed that effort among other steps she said the Alberta government, as well as the federal government, would need to take if Premier Danielle Smith decides to withdraw the province from the federal retirement plan and set up its own program.
Her remarks came following a virtual meeting with provincial finance ministers, in which she says they discussed the consequences of Alberta going ahead with its proposal.
“Of course Alberta has the right to withdraw,” Freeland told reporters.
“But Alberta’s choice about the [Canada Pension Plan] also implicates every single Canadian.”
Freeland, who called herself a “proud daughter of Alberta,” said she is hearing from Albertans who are concerned about the idea.
She added she is asking the chief actuary to “provide an estimate of the asset transfer,” based on a “reasonable interpretation of the provisions in the [Canada Pension Plan] legislation.”
Alberta Treasury Board president and Finance Minister Nate Horner issued a statement following the meeting applauding the federal government’s move to involve the chief actuary for an estimate.
“To be clear, Alberta is committed to making sure that any potential creation of an Alberta Pension Plan will not leave our fellow Canadians without a stable pension and its associated benefits,” Horner said.
“We are encouraged to hear the federal government commit to providing a comprehensive actuarial analysis of the asset transfer value Alberta would be entitled to receive should it withdraw from the CPP. We’ve been asking for this for several weeks.”
On the issue of negotiating international social security agreements, Freeland told reporters during Friday’s news conference that if Alberta launched its own program it would need to do so to “ensure similar treatment of contributors who spend part of their careers aboard.”
Quebec has negotiated its own such agreements with 39 countries, while Canada has done the same with 60.
“This would be a complex and multi-year process and it would be taking place at a time of real uncertainty,” Freeland said, both in terms of “geopolitical uncertainty” and “global economic uncertainty.”
The Alberta government argues that its workers have contributed an oversized share to the national fund and would be in line for big savings and payouts if it were to leave the CPP.
Alberta Premier Danielle Smith had planned to hold a possible referendum on leaving the CPP in 2025, but now says she won’t go ahead with such a vote until governments or the courts deliver a hard number on how much Alberta will get if it leaves the plan.
Outside the provincial legislature in Fredericton, New Brunswick Premier Blaine Higgs said he understands why Smith is proposing to pull her province out of the Canada Pension Plan.
“I don’t feel Alberta is leaving Canada,” Higgs said. “I think that Canada, in many ways, has left Alberta.”
He said that as the premier of a Maritime province that receives federal equalization payments, it’s worth noting that Alberta has been a major contributor to those funds. And he questioned why federal policies are “shutting down [Alberta’s] resource revenues at a time when they’re trying to reconfigure their economy.”
Higgs did not elaborate on what he meant by that. But he said Alberta’s bid to leave the pension plan represents a “shot across the bow” and “a reality check, and I understand it.”
The New Brunswick premier, however, said he did not agree with Smith’s approach.
“If Alberta came out of the CPP funding formula, it would be a major problem … for Canadians across the country. I don’t think that’s Alberta’s intention.”
Nova Scotia Finance Minister Allan MacMaster, who chairs the council of provincial and territorial finance ministers, told reporters following the meeting that every province expressed how much they care about the Canada Pension Plan.
MacMaster was asked whether Alberta is softening its stance.
“What Alberta communicated today was much what they’ve been communicating already publicly, so there’s nothing really new there and I wouldn’t speak for Alberta,” he said.
MacMaster said he doesn’t want to speculate on what could happen, but he believes the pension plan is better with Alberta in it.
“We want them to stay, and there was real consensus on that today,” he said, adding that it would be a concern if any province pulled out.
“One of the strengths of the plan is that it’s portable, people can move from province to province ? enjoying the benefit of the Canada Pension Plan,” said MacMaster.
“I don’t want to cause concern for people. I want people to know that there’s a strong consensus around the country about the importance of the Canada Pension Plan and we all want to work together to keep it the way it is.”
Ontario Finance Minister Peter Bethlenfalvy also put out a statement following the meeting, calling unity a strength of the CPP.
“In a period of economic uncertainty, no Ontarian — or Canadian — should have to worry about the security of their retirement savings. Unity is a strength of the CPP, and it is a strength of our country. But unity requires fairness.”