Federal Finance Minister Joe Oliver’s insistence that the federal bureaucracy will not lift a finger to help Ontario establish its new provincial pension plan is petty and potentially damaging to the idea of a co-operative national securities regulator.
By now, it should be clear that the federal Conservatives and Ontario’s Liberals have very different social, political and economic philosophies. One shining example is the fundamental disagreement over how to beef up retirement savings.
Ontario would prefer that the feds agree to expand the Canada Pension Plan (CPP). In the absence of that, Ontario has decided to establish a new provincial pension plan, the Ontario Retirement Pension Plan (ORPP). The feds are adamantly opposed to any sort of compulsory CPP expansion. Instead, they have just launched consultations on the design of a possible voluntary CPP supplement. The federal government also continues to promote private alternatives, such as pooled registered pension plans (PRPPs), as a solution to the decline of workplace pensions and a lack of private provisioning for retirement. Clearly, Ontario and the feds have two distinct approaches to solving the same social problem.
Yet, for Oliver to declare that the feds will not make any legislative changes to help integrate the ORPP into the existing retirement savings framework or allow federal agencies to provide any administrative support to Ontario’s new plan is needlessly spiteful and counterproductive.
This is the same federal government that is seeking agreement with the provinces to make the feds’ new retirement savings vehicle of choice, PRPPs, more efficient. Ottawa also wants the provinces to sign on to a new model for securities regulation premised on federal/provincial co-operation.
If the feds expect the provinces to play along when it comes to PRPPs and the proposed Co-operative Capital Markets Regulator (CCMR), Ottawa must understand that co-operation can’t be a one-way street. Oliver’s stance undermines Ottawa’s professed interest in helping Canadians save in low-cost, efficient ways while also stoking fears that the federal government will undermine the provinces in federal initiatives such as the CCMR.
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