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Liberals would also provide workers the opportunity to have CPP take over the investment of their pension plan in the event their employer goes bankrupt.
Ottawa (8 December 2009) – Liberal leader Michael Ignatieff is backing the idea of a national supplementary government pension plan to increase the retirement savings of Canadians.
The proposed plan sounds similar to the Alberta/B.C. (ABC) plan, which is expected to be implemented in lieu of a workable federal solution. An original aspect of the Liberal plan is to give pension plan beneficiaries the option to pool their plan with the Canadian Pension Plan in the event the plan sponsor goes bankrupt.
“So when a company goes bankrupt and pensioners are needing help, they could elect to have the CPP step in and manage their pension fund assets for growth though a trusted vehicle like the CPP," Ignatieff said.
The Liberals are also looking for changes to the Bankruptcy and Insolvency Act to protect pensioners when companies go bankrupt, particularly those on long-term disability. Such pensioners are currently at risk of losing all pension benefits in the event of a plan sponsor bankruptcy, and the Liberal’s plan would improve their status to preferred creditor.
Federal and provincial finance ministers are meeting in Whitehorse on Dec. 17 and Dec.18 where pension reform is expected to figure prominently on the agenda.
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