The Alberta Pension Plan panel fielded questions and provided information in a Calgary-based town hall Thursday night, with a respectful but generally nervous group of callers concerned about specifics.
It’s fair to say that of the 29 callers who contributed, the majority expressed hesitation at the prospect of leaving the Canada Pension Plan, some more firm than others. The province is holding engagement sessions across the province – this one in Calgary – to find out more about how Albertans are feeling about the idea of leaving the Canada Pension Plan.
The primary concerns expressed by contributors included the actual withdrawal amount from the Canada Pension Plan, the type of investments the pension would participate in, the lack of long-term demographic forecasts, the use of the phrase “over contribute,” the impact on other Canadians’ pensions and that it was a distraction from other important issues.
Panelists Jim Dinning (chair), Mary Ritchie and Moin Yahya responded to all of the participants’ questions, also ensuring that their concerns would be noted.
One of the most common questions on the application of an Alberta Pension Plan was how the fund would be invested. Alfred said that if the pension were to heavily invest in Alberta, it could be to the detriment of the fund.
“What we should do is exactly not invest in Alberta,” he said.
“This could be a concern for this or any future government that we have, that there is an over-investment in our province, which would not be in the interest of pensioners at all.”
Ritchie said that diversification would be a key element of an investment strategy for an Alberta Pension Plan – and is a generally good investment approach overall.
“You have to look at equities and bonds and real estate and there are many, many places to invest all over the world,” she said.
Distractions, portability and ‘over contribution’
Ian, Paul, Laurel and Scott each said they felt that this was a distraction from other issues that Alberta was facing right now.
“I just don’t understand why we’re being distracted by this. And I guess my thinking is right now we have the power of nine provinces working towards this Canadian pension plan. How does it make sense to go it alone?”
Dinning responded by saying that all provinces are contributing to the Canada Pension Plan, but not equally.
“Some are net contributors like Alberta. We are putting collectively more money into the plan, and other provinces are net drawers. So other provinces are taking money out of the system,” he said.
Other callers challenged that notion, saying that the contributions and withdrawals are the same by person, only influenced by the province’s demographic and earning power. Many questioned what would happen to the Alberta Pension Plan once the demographic shift impacts Alberta negatively.
“I think you should find another word other than over contribute. That’s a really loaded term,” said John.
“Albertans have contributed exactly what they should have under the plan and they’ve received exactly what they should have under the CPP. It’s a loaded term.”
John also suggested that a 100-year stress test be carried out to ensure the plan would be resilient in a worst-case scenario.
Several questions were around the portability of the APP if a person moved to another province. Ritchie said that what would happen is if a person was still paying into CPP, that person would be tracked, as they would be if they were contributing to the APP.
“So, in essence, there would be two cheques received to them,” she said.
“It is the culmination of all your years of work and working in various provinces.”
Those in favour, the impact on the CPP, and being ‘heartless’
Out of the 29 callers, by the LWC count, five were clearly in favour of having an Alberta Pension Plan. They cited the flexibility, the fact Albertans have paid more and received less, and that we need to de-couple the province from the whims of the rest of Canada.
Still, a couple of those in favour supported it with caveats.
Jeff said he was in favour as long as the bureaucracy didn’t overburden the actual plan. Though Dinning said that labour costs, infrastructure costs and other overhead were less in Alberta than other parts of the country, one caller pointed out that all of those costs would be borne by Albertans rather than spread out between nine provinces and three territories.
Gary from Calgary said he was all for an Alberta Pension Plan, provided the provincial government didn’t get their mitts on it.
“I’m all in favour of an Alberta pension plan and with the specifics that it would be hands off as far as we’re an arm’s length as far as the government is concerned,” he said.
“There’s no dipping into that to the point of where we wind up with an unfunded liability.”
Heather may have had the most passionate comments of the evening, worried about the impact of withdrawing from CPP on other Canadians, including loved ones.
“I’ve got close relatives that live in other provinces and if we pull 53 per cent – no matter how much of the assets we pull out there – if we pull 53% of the assets out there we are going to decimate the pensions for my relatives that live in other provinces,” she said.
“I am just sick about that. How can we do that to people that we know and love? How can we be so greedy and so selfish that we are going to take as much as we can for us and leave them out in the cold? That is just plain heartless.”
‘We heard you loud and clear tonight’
The province launched the engagement after releasing a Lifeworks report in late September 2023 on a proposed Alberta Pension Plan. That report posits that Alberta would be able to remove $330 billion of the roughly Canada Pension Plan net value. Dinning did reiterate that the federal government would be providing a firm value that would be withdrawn and that number would be made public prior to the province posing a potential referendum question.
Dinning said that there are very different points of view on the viability of an Alberta Pension Plan. He said their public engagement was an important exercise. He noted that we would be interested to see how the number of callers matched with those logged into the town hall overall. To start, those on the phone and online were asked two questions about what they’re most interested in and the concerns they have.
“We’ve heard you loud and clear tonight and we hope when you see our report that you’ll see your comments and your views in that report,” he said.
“If you do then we will have done we will have done our job.”
The next town hall session is scheduled for Nov. 16 at 6:30 p.m. More information is available on the aforementioned website.