* Flaherty says real GDP, unemployment triggers may be set
* No consensus as federal, provincial finance ministers meet
* Ontario pushing for reform sooner but hails progress
By David Ljunggren
MEECH LAKE, Quebec, Dec 17 Canada's finance
minister agreed on Monday to set economic benchmarks for
potentially expanding the country's public pension system in the
future, but said the economy was too weak now to demand bigger
contributions from businesses and workers.
Federal Finance Minister Jim Flaherty met with his
provincial counterparts late Sunday and Monday to discuss issues
of joint responsibility.
The main item on the agenda was a proposal for "modest"
enhancements to the Canada Pension Plan (CPP), based on studies
showing Canadians are not saving enough for their retirement and
raising doubts about the government's ability to finance the
pensions of retiring baby boomers.
Flaherty had previously ruled out any changes to CPP but
appeared somewhat more flexible at the end of the meeting,
although punting any policy action until a later date.
"There's no consensus on the CPP expansion at this time but
the ministers did agree that we would task our officials with
working on definitions of 'modest increase' and economic
triggers that we would then discuss at our next meeting in
June," Flaherty told reporters.
The CPP is a nationwide program, although the province of
Quebec also has its own similar program, to which all employers
and employees must pay premiums.
Flaherty said provincial finance ministers were hesitant to
move ahead with changes because of the uncertain economic
"We'll need to have some kind of measure about real GDP
growth, or an unemployment rate, or both, triggers like that so
that the ministers can be confident, and the government can be
confident, that the economy could take the extra burden that
would be put on employers and employees were there to be an
increase in the contribution rate to the Canada Pension Plan,"
Various formulas for boosting the savings rate under CPP
have been floated. Any changes would require agreement by
two-thirds of Canada's provinces representing two-thirds of the
population, but Flaherty has said he would prefer unanimity
before making such a major shift.
Ontario Finance Minister Dwight Duncan, one of the most
vocal proponents of pension reform, said he was pleasantly
surprised at the progress made.
"I was worried we wouldn't move forward today, we've moved
forward, it's still a little too slow for my taste but I think
this allows us to move to the next step," he said.
The Canadian Labour Congress said on Monday 60 percent of
workers in Canada have no workplace pension and one-third
between the ages of 24 and 60 have no retirement savings.