Advisors hoping proposed changes to the CPP would scuttle the ORPP have been dealt a blow
Advisors have been dealt a blow in their hopes of seeing the ORPP die before it ever really lived.
In the 2015 Ontario Economic Outlook and Fiscal Review the government revealed plans to push full steam ahead with the ORPP.
“The implementation of a CPP enhancement would take considerable time and requires the agreement of governments across the country. In light of these circumstances and the pressing need to address retirement security, Ontario continues to move forward to implement the ORPP in 2017, while allowing for potential integration of the ORPP with a CPP enhancement in the future,” the report said.
Advisors and the industry alike had been hoping the province would slow down on its intentions with the ORPP given the Trudeau Liberals sweeping the Conservatives out of power. Stephen Harper was particularly disparaging of what he termed the plan a job killing payroll tax, going on the record that he was “delighted” to block any federal assistance to set up or administer the Ontario plan.
Trudeau had promised an expansion of the CPP, which the industry hoped would make the creation of an Ontario plan redundant. But it appears those pleas have fallen on deaf ears.
“Ontario has played a leadership role in advocating for a CPP enhancement since 2010 and welcomes the renewed interest from the federal government in addressing retirement security collaboratively with the provinces and territories,” the report says. “Ontario will be an active participant in national discussions on this issue. The province will support a CPP enhancement that is consistent with the ORPP’s objectives with respect to adequacy and coverage.”
The Ontario Retirement Pension Plan will require mandatory contributions from employers and workers at any company that does not already offer a workplace pension. Companies will have to pay premiums of 1.9 per cent for each employee, up to $1,643 a year, and the workers would pay an equal amount.
The plan will be phased-in, starting Jan. 1, 2017 for companies with 500 or more workers, expanding to companies with 50-to-499 workers in 2018 and to employers with fewer than 50 workers in 2019.
As another step in the implementation of the ORPP, the government has
appointed the initial board of the ORPP Administration Corporation.
The board, which will oversee the start-up of the corporation, will be led by Susan Wolburgh Jenah, who will serve as the chair, with two members, Murray Gold and Richard Nesbitt.
The government also announced it intends to confirm that the ORPP minimum earnings threshold will be aligned with the CPP’s Year’s Basic Exemption of $3,500 for eligible employees between the ages of 18 and 70.
The hope is that it will ensure that workers in multiple jobs, or part-time or temporary employment, benefit as much as possible from the ORPP.
The government also revealed it will initiate, on an expedited basis, a review of the current solvency funding rules for defined benefit pension plans, focusing on plan sustainability, affordability and benefit security.
In the 2015 Ontario Economic Outlook and Fiscal Review the government revealed plans to push full steam ahead with the ORPP.
“The implementation of a CPP enhancement would take considerable time and requires the agreement of governments across the country. In light of these circumstances and the pressing need to address retirement security, Ontario continues to move forward to implement the ORPP in 2017, while allowing for potential integration of the ORPP with a CPP enhancement in the future,” the report said.
Advisors and the industry alike had been hoping the province would slow down on its intentions with the ORPP given the Trudeau Liberals sweeping the Conservatives out of power. Stephen Harper was particularly disparaging of what he termed the plan a job killing payroll tax, going on the record that he was “delighted” to block any federal assistance to set up or administer the Ontario plan.
Trudeau had promised an expansion of the CPP, which the industry hoped would make the creation of an Ontario plan redundant. But it appears those pleas have fallen on deaf ears.
“Ontario has played a leadership role in advocating for a CPP enhancement since 2010 and welcomes the renewed interest from the federal government in addressing retirement security collaboratively with the provinces and territories,” the report says. “Ontario will be an active participant in national discussions on this issue. The province will support a CPP enhancement that is consistent with the ORPP’s objectives with respect to adequacy and coverage.”
The Ontario Retirement Pension Plan will require mandatory contributions from employers and workers at any company that does not already offer a workplace pension. Companies will have to pay premiums of 1.9 per cent for each employee, up to $1,643 a year, and the workers would pay an equal amount.
The plan will be phased-in, starting Jan. 1, 2017 for companies with 500 or more workers, expanding to companies with 50-to-499 workers in 2018 and to employers with fewer than 50 workers in 2019.
As another step in the implementation of the ORPP, the government has
appointed the initial board of the ORPP Administration Corporation.
The board, which will oversee the start-up of the corporation, will be led by Susan Wolburgh Jenah, who will serve as the chair, with two members, Murray Gold and Richard Nesbitt.
The government also announced it intends to confirm that the ORPP minimum earnings threshold will be aligned with the CPP’s Year’s Basic Exemption of $3,500 for eligible employees between the ages of 18 and 70.
The hope is that it will ensure that workers in multiple jobs, or part-time or temporary employment, benefit as much as possible from the ORPP.
The government also revealed it will initiate, on an expedited basis, a review of the current solvency funding rules for defined benefit pension plans, focusing on plan sustainability, affordability and benefit security.
