The Investment Funds Institute of Canada (IFIC) isn’t in favour of a voluntary CPP.
In a letter to the Department of Finance, IFIC president and CEO Joanne De Laurentis says the government should focus on promoting existing retirement savings programs “rather than add yet another new program in the form of a voluntary CPP.”
Read: Implications of the voluntary CPP for employers
She says the problem for those at risk of undersaving is the underutilization of existing savings programs and the government could increase employee participation in existing DC plans by using auto-enrolment and auto-escalation features.
Joanne De Laurentis also says a voluntary CPP will be complex to set up and costly to administer “given the likelihood of a fairly low participation rate and the need to track individual accounts.”
Read: Ottawa seeks feedback on voluntary CPP
If the federal government goes ahead with a voluntary CPP, she doesn’t want it to disrupt existing retirement savings programs.
“Given that the CPP supplement would be competing for assets with private savings options, any beneficial design features built into the CPP supplement should be extended to existing programs like group RRSPs,” De Laurentis explains.
Read the whole letter on IFIC’s website.
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