Home News and Politics Meeting Scheduled: Freeland to Discuss Alberta’s Proposed CPP Withdrawal with Finance Ministers

Meeting Scheduled: Freeland to Discuss Alberta’s Proposed CPP Withdrawal with Finance Ministers

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Meeting Scheduled: Freeland to Discuss Alberta’s Proposed CPP Withdrawal with Finance Ministers

Finance Minister Chrystia Freeland to Discuss Alberta’s Proposed Withdrawal from Canada Pension Plan

Finance Minister Chrystia Freeland has confirmed that she will be holding a virtual meeting with her provincial and territorial counterparts on Friday to discuss Alberta’s proposed withdrawal from the Canada Pension Plan (CPP). Freeland stated that she has heard concerns from “many Canadians” regarding this potential move.

In a letter to the ministers, Freeland acknowledged that Alberta has the right to withdraw from the CPP but emphasized the importance of making an informed decision based on a clear understanding of the risks involved. She highlighted that safeguarding the pensions of all Canadians is a priority for the government and expressed her anticipation for the upcoming discussion.

Premier Danielle Smith presented the idea earlier this year after a report commissioned by her government suggested that Alberta would be entitled to $334 billion from the existing CPP fund if they were to withdraw. However, this figure has faced criticism for being inaccurate.

The report cited Alberta’s younger working population, higher incomes, fewer seniors drawing from the CPP, and years of significant contributions from residents of the province. Nevertheless, Freeland disputed the figure, stating that further analysis is required. The Canada Pension Plan Investment Board estimated that Alberta is owed around 16% of the fund.

Although the CPP legislation includes an exit clause allowing provinces to pull out of the program if they have their own old-age security program, only Quebec has exercised this option. Political scientist Duane Bratt likened Alberta’s potential withdrawal to a divorce, given the province’s nearly 60-year participation in the plan.

Pushback from Various Provincial Governments and Political Figures

The proposed plan has faced resistance from numerous quarters, including Alberta’s opposition NDP and several provincial governments, such as the Ontario Progressive Conservatives and federal Conservatives. Ontario Finance Minister Peter Bethlenfalvy has called for the upcoming Friday meeting, and federal Conservative Leader Pierre Poilievre has urged Alberta to remain in the CPP.

The Alberta Federation of Labour (AFL) also criticized the proposal, describing it as a “zombie policy that refuses to die” and highlighting the potential negative impact on retirement security.

Freeland Highlights Flaws in Alberta’s Exit Formula

In her letter to the finance ministers, Freeland emphasized that Canadians view the potential withdrawal as a threat to pensions in Alberta and across the country. She intends to address flaws in Alberta’s exit formula during the meeting, pointing out that some estimates suggest Alberta, Ontario, and British Columbia alone would be entitled to 128% of CPP assets if the formula were applied. Freeland deemed such an outcome untenable and absurd.

With the meeting taking place on Friday, this issue continues to generate significant discussion and debate among policymakers and Canadians concerned about retirement security.

With files from Global News’ David Baxter and The Canadian Press

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