Neil Faba | May 02, 2011
The federal government’s December 2010 announcement of the pooled retirement pension plan (PRPP) arrangement has been the most significant piece of pension reform introduced in Canada since discussion on the topic increased following the 2008 economic crisis, according to a panel speaking at the Benefits & Pension Summit, held in Toronto last week.
The panellists, Tina Di Vito, director of retirement solutions with BMO’s retirement market group; Greg Heise, partner at Morneau Shepell; and Frank Swedlove, president of the Canadian Life and Health Insurance Association (CLHIA) agreed that the program’s success will depend on its design.
While Canadians will have to wait until legislation supporting PRPPs is introduced before full details are understood, Quebec’s unveiling of its voluntary retirement savings plan (VRSP) in its 2011 budget included important details that all the panelists agreed should be matched by other provinces.
“The primary purpose of this vehicle is improving pension coverage in Canada. We know that Canadians aren’t saving enough for retirement, and this is really an issue of, ‘If you build it, will they come?’ It will depend on how well you build it,” said Heise.
Heise said the harmonization of PRPPs across Canada will be a key issue, to ensure Canadians have a retirement savings vehicle that is portable from employer to employer and province to province.