Desperate times, desperate measures surround ORPP
Ontario government needs to rethink pension disaster-in-waiting
Toronto, July 30, 2015 – In light of its increasingly desperate demands for federal co-operation on its unpopular forced retirement savings plan, the Canadian Federation of Independent Business (CFIB) is renewing its call for the Ontario government to allow Ontarians to choose how to invest for their retirement.
“Ontarians have told us they cannot afford to save more for retirement, and yet the provincial government insists on moving forward with their misguided Ontario Retirement Pension Plan (ORPP),” said CFIB president Dan Kelly. “It’s time to listen to the people and give them voluntary savings options so Ontarians have a meaningful say in how they save.”
A recent poll conducted by CFIB found that Canadians prefer voluntary savings vehicles like TFSAs or RRSPs over mandatory retirement savings plans.
Ontario’s small business owners are strongly against this job-killing payroll tax, with 86 per cent opposing the ORPP. Seven in 10 said it would force them to freeze salaries, while over half said they would be forced to eliminate positions to cope with the added costs.
The ORPP will have a negative impact on job creation and economic growth, according to CFIB’s economic analysis. It will increase the province’s unemployment rate by 0.5 per cent by 2020, and reduce wages in the longer term. In addition, it will take 40 years for contributors to receive full benefits, meaning that this plan does nothing to help today’s seniors.
Once in place in 2017, the ORPP will require every Ontarian without a workplace pension plan to pay up to $1,643 in mandatory pension premiums per year. Employers would have to match the contribution amount for each of their employees. Large corporations and unions with pensions will be exempt from the tax.
“Business owners are looking to the government to promote economic stability,” said Nicole Troster, CFIB director of provincial affairs for Ontario, who noted that the province has a deficit of nearly $11 billion and an overall debt of $284 billion. “Moving forward with this reckless payroll tax may be music to the ears of government unions, but does nothing to instill confidence among the province’s business owners.”
For more information or to arrange an interview with Dan Kelly or Nicole Troster, contact Ryan Mallough at 416 222-8022 or email firstname.lastname@example.org.
CFIB is Canada’s largest association of small and medium-sized businesses with 109,000 members across every sector and region.