An Alberta Pension Plan (APP) could save Albertans billions of dollars each year, with lower contribution rates, higher benefits and stronger benefit security for families and retirees, according to a report conducted by LifeWorks. .“This report shows a made-in-Alberta pension plan could put more money in the pockets of hard-working families and business owners and improve retirement security for seniors,” said Alberta Premier Danielle Smith in a Thursday press release. .“We want to hear from you because it’s your pension, your choice.” .A final decision whether or not to go it alone would be made after a plebiscite on the issue..Smith said she was “so excited to hear what Albertans think about a provincial pension plan that could benefit Albertans now as well as our future generations.” .Albertans will be able to review the report on the potential creation of the APP ahead of an Alberta-wide engagement. .Due to Alberta’s young population, high employment rates and higher pensionable earnings, the government said it has contributed billions more to the Canada Pension Plan (CPP) than what was required to fund benefits paid to seniors. .Alberta Finance Minister Nate Horner said the government has a responsibility to present these findings to people and obtain their opinions. .“Albertans will make the final decision on where we go from here,” said Horner..“It’s your pension, your retirement and your future.” .The Alberta government is asking Albertans to review the report's findings, ask questions and provide feedback on its next steps. .Over the fall and into spring 2024, an engagement panel will gather feedback from Albertans on their thoughts, suggestions and concerns about the APP. The panel will submit a report to the government based on the Alberta-wide engagement. .APP Engagement Panel Chair Jim Dinning called its job “straightforward.” .“We ask Albertans to look at the facts, participate in the discussions and then tell us what they think about an Alberta Pension Plan and the different options we must consider,” said Dinning. .“We expect our conversations will be complex and, at times, fiery, but people engaged in debate reminds all of us how important sound public policy is for our security and prosperity.” .The Alberta government estimated it should be entitled to a $334 billion asset transfer from the CPP in 2027. This is how much Albertans have contributed to the CPP minus how much they have received in benefits and the investment earnings since it started in 1966. .An estimated $5 billion in savings in the first year alone could be used to boost pension benefits for seniors. That could include a significant increase to each senior’s monthly pension payment or a $5,000 to $10,000 bonus payment at retirement. .The difference Alberta workers would pay in CPP and APP premiums would save them up to $1,425 every year while maintaining the same level of benefits to seniors. This extra pay to workers could be used to meet the priorities and needs of their families. .An APP could reduce the premiums businesses pay. Businesses could use this money to buy equipment or hire more employees. .The government will work with partners at the CPP to develop agreements allowing people to move throughout Canada without disrupting or decreasing benefits. .For decades, Alberta’s young working population, higher employment rates, and higher pensionable earnings have resulted in businesses and workers contributing about $60 billion more into the CPP since inception than has been paid out during the same period. .One of the government’s priorities during the fall 2023 session is introducing legislation requiring a referendum before it could withdraw assets from the CPP to establish an APP. It would guarantee the same or lower contributions and the same or better benefits for seniors. .It concluded by saying bringing forward the possibility of an APP by releasing this report will ensure people are well informed to make a decision about their future. .While Smith did not campaign on starting the APP, she said she committed to releasing the report. ."We knew we needed to get the updated numbers," she said. ."The original report had been completed in 2021." .She said she did not talk about it sooner because of timing. In every interview she did during the election, she said the report needs to be released and the numbers provided..CPP Investments Global Head of Public Affairs and Communications Michel Leduc responded by saying he respects the right of Albertans to consider withdrawing from it, but the amount that could be extracted from it does not add up. ."References to how much a province might claim from the CPP Fund should be regarded with caution and a high degree of skepticism until many issues are resolved between federal and provincial governments," said Leduc. ."Any idea of a withdrawal from the CPP would be complex, fiercely disputed, involving political posturing, and would result in risk for Albertans for years to come." .The best way Leduc said to provide financial security to Albertans during retirement is to preserve a national fund. .Alberta's Fair Deal Panel recommended numerous changes the province could make to get a better deal in confederation in 2020, but there was no talk of long-term constitutional change and independence..READ MORE: Fair Deal Panel recommends Alberta police and pension; status quo on Constitution.The Fair Deal Panel said Alberta should take immediate steps to create a provincial pension plan, set up its own police force and appoint a chief firearms officer.
