CALGARY — A new report says there are steps the government can take to ensure Canadians have enough money in their retirement — and they don’t have to be sweeping measures to make a difference.
The paper by the University of Calgary’s School of Public Policy released Tuesday says Canadians have had a tougher time saving for old age since the 2008-2009 economic crisis, especially those with modest incomes.
“Our view is that the Canadian Retirement Income System is not in crisis, but can be improved,” authors Jack Mintz and Thomas Wilson wrote.
“Forcing increased savings for retirement for a large group of Canadians may well make many of them worse off. As in medicine, we believe the first mandate of pension reform should be ’do no harm.”’
The authors suggest that the Canadian Pension Plan be expanded to enable 35 per cent of a worker’s income to be replaced in retirement, up from the current 25 per cent level.
That would mean an additional contribution of about 2.5 per cent, shared between employer and employee, or by just the employee.
Mintz, a tax policy expert, said anything much larger could “do more harm than good” — especially for young Canadians looking to buy a home or start a family.