Canadians want workplace retirement plans

New research by the Environics Research Group finds that 89 per cent of Canadians want workplace-based retirement savings programs made available to all workers. Fifty-six per cent of those not already in such plans are interested in joining one, with younger workers particularly keen (69 per cent of 18-29 years olds and  68 per cent of 30-44 year olds.) Four-in-ten (41 per cent) workers would consider changing jobs to an employer that offered one.

Currently only about 50 per cent of Canadian private sector workers participate in a workplace-based savings program such as an employer-sponsored pension or group RRSPs.

The Canadian Life and Health Insurance Association (CLHIA) is recommending changes to dramatically improve use of workplace retirement savings plans including expanding access to multi-employer pensions plans (MEPPs) and protecting savings in group RRSPs through locking-in employer contributions.

Key recommendations include:    

-   Amend pension legislation to permit any employer (including self-employed) to participate in a DC-MEPP (Defined Contribution Multi-Employer Pension Plan.) This would relieve employers of almost all administrative costs and compliance burdens for pension plan management;    

-   Require businesses with 20 or more employees to offer their own pension plan either via a DC-MEPP or a group RRSP. This would ensure that more than 80 per cent of Canadian workers would have access to an efficient, cost-effective way to save for retirement;    

-   Lock-in employer contributions to group RRSPs;    

-   Broaden the definition of "earned income" for RRSP purposes to include items such as royalties, active business income, rental income, etc. The current definition creates savings barriers for the self-employed and professionals.

Read the complete report, available at http://www.clhia.ca/download/Policy_Saving_More_For_The_Future_ENG.pdf  

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