Keith Ambachtsheer told the Ontario Expert Commission on Pensions that it should look beyond trying to fix the defined benefit and defined contribution system at a public hearing this morning.
“I know that the original intent of this commission was sort of a fix the potholes type of mandate,” the president of KPA Advisory Services told the commission.
“And I encourage you to think beyond that, that in fact you have a tremendous opportunity here to create a vision for Canada’s retirement income system, especially the occupational part that goes beyond trying to save the traditional DC and DB arrangements that we currently have. They’re both flawed.”
Ambachtsheer said there needs to sort of national, provincial or regional arrangement that covers workers who are not lucky enough to be part of a registered retirement pension arrangement.
“I know a lot of your work and questions relate to fixing DB and DC systems that already exist,” he added, “but I would encourage you to also deal with the coverage issue in your work so that we don’t leave well over 50% of the private sector workforce behind due to the reality that they currently covered by an occupational pension plan.”
The U.K. has gone this route and are looking at a system that will cover those who aren’t covered by a private plan with an opt-out, Ambachtsheer said, adding that the research shows that if a sensible system is created for that non-covered part of the private sector workforce, most will in fact stay in.
“We in Canada have already created the CPP Investment Board, viewed around the world as an excellent organization fulfilling its task and I have every confidence that if we put our minds to it, we could create a Canada Supplementary Pension Plan-type arrangement that would be one of the best in the world,” he said. “It’s a matter of leadership and will.”
The public hearings continue next Tuesday and Wednesday in Toronto before moving on to Kingston and Ottawa the following week. For more information regarding the hearings, click here.
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