Monday, December 16, 2013

CPP reform rhetoric

Since there is a significant meeting among Canadian finance ministers today, where reform to the Canada Pension Plan is on the agenda, it's worth pointing out some really unhelpful ongoing language the federal Finance Minister is using to describe CPP. This is what he said today to describe CPP:
"CPP is a tax on people who work, a tax on employers. It takes money directly out of the economy, so it's not something to be done lightly. It's something that must be done with consideration and thought," he said.
This framing of CPP, a valued Canadian program that is the backbone of our savings retirement, as just another vile tax should be countered. Here's one:
There is not a shred of credible empirical evidence to support assertions CPP contributions amount to a payroll tax and a job killer. CPP contributions, like all contributions to any pension plan, are deferred wages. Calling an employer's pension contribution a payroll tax is disingenuous, if not an outright deception.
Deferred wages. Savings investments. A retirement worth paying for.

Or choose whatever else you'd like to call it to accurately describe the value and positive association most Canadians would have in their minds to ascribe to CPP.

The Conservatives are masters of dumbing down issues into these convenient ideological talking points. The facts are that people are not saving, there are a growing number of provinces getting behind expanded CPP for such reasons, and Canada's economy - as the Conservatives enjoy telling us - is one of those to be envied among world nations.

We should be tackling pension reform and hopefully, in the long term, if serious people keep speaking up, the need to address this issue will trump the rhetoric.