The recent financial crisis and recession have brought the viability and security of employer-sponsored pension plans, the sustainability of public pension programs and the adequacy of individual retirement saving into the spotlight since late 2008. In this context, and at a time when governments in Canada are actively consulting about the issue, the Institute for Research on Public Policy held a symposium to explore the retirement income prospects of today’s middle-income workers and possible reform options. This is in contrast with earlier pension debates, when then-current retirees were the focus. The event consisted of expert panels and presentations based on research commissioned by the IRPP and other groups; it brought together 60 invited experts and practitioners from government, business, labour and academia. The following highlights some of the issues raised and conclusions reached during the event.
Pension politics are difficult, and participants raised concerns that some proposals had little political appeal. But in his address Ontario Finance Minister Dwight Duncan said that “doing nothing is not an option,” pointing out that all reform options might not be mutually exclusive and that the optimal policy outcome – the one meeting agreed upon principles – may require a mix of different elements. He said political decisions will determine the balance among the criteria.
The rapporteur noted there is a danger that for all the consultation by government, the debate will now move behind closed doors, leaving little room for nongovernment voices to weigh in on the various proposals. At any rate, there is no quick fix and the recent political momentum could wane, so progress might be slower than expected. For all the recent urgency in public discourse, he noticed an implicit acceptance at the symposium that this round of talks could take years to come to fruition. Politicians – possibly excepting British Columbia – seem concerned that quick solutions will be suboptimal, and appear inclined toward caution. This was certainly true for Federal Finance Minister James Flaherty, who said that all options were still on the table, but he did not want to unduly increase the future burden on his triplet sons. The federal government, he said, would not avoid making difficult decisions, but it would not make them hastily.