Canadian taxpayers are on the hook for billions more than the federal government is willing to admit, according to the C.D. Howe Institute. That claim comes after the think tank performed a fair-value accounting analysis of Ottawa’s employee pension obligations.
Alexandre Laurin and William Robson, authors of The Public Sector Pension Bubble: Time to Confront the Unmeasured Cost of Ottawa’s Pensions, contend that taxpayers are exposed to a $65-billion funding shortfall.
The gap is so large that to close it, contributions in the latest fiscal year would have had to be almost double what was actually paid in. The risk posed by the funding shortfall is that taxpayers will inevitably have to make up for it—through either higher taxes or spending cuts—or risk the government defaulting on its debt.
To read the study, click here.
