Why is the UCP’s pension reform pitch so wildly unrealistic?
Two possible reasons: either they’re complete idiots, or they have larger goals in mind.
The mass mailing to Alberta households that started landing Thursday gives plenty of clues.
It continues to repeat the fiction of Alberta being owed more than $300 billion from the Canada Pension Plan.
Nobody, not even the drivers of this steamroller, believes such a sum can be extracted from the CPP. No provincial or federal leader outside Alberta has voiced a word of support, only alarmed opposition.
But the card in the mailbox insists that an Alberta plan would save $5 billion a year. Employees and companies would pay $1,425 less in annual contributions to an Alberta pension.
And this system would be so flush that Albertans could get a “large bonus payment” when they retire.
It’s all based on the imaginary $334 billion. The UCP is using the most extreme numbers, based on several possible interpretations of the Canada Pension Plan Act.
The mail-out has all the bluster of a campaign promise that will never be kept. This a certainly a campaign, but it’s not really about the pension at all.
The UCP is trying to show how much the province has contributed, and how the country would suffer if the federal Liberals suppress the economy with climate measures and direct control of resource projects.
That basic message has been constantly repeated for many years by Alberta conservative governments. Canadians elsewhere are used to it. They nod and tune out.
But the pension shock treatment seems to threaten the retirement benefits for other Canadians. Real money from real people.
The country has snapped awake. A national meeting of finance ministers will be held to get answers from Alberta.
I don’t believe there’s been such a visceral response to anything Alberta has done since the late Progressive Conservative premier Peter Lougheed cut oil shipments to Ontario refineries in the spring of 1981.
Like the pension drive, Lougheed’s startling move threatened people’s daily lives. That really gets attention, far more than any legalisms about the constitution or federal legislation.
With its pension demand, the UCP offers no sympathy to the rest of Canada, not a word about how other people’s pensions might be affected if Alberta makes off with more than half the CPP assets.
Many Albertans are offended by that omission, including me. But that, too, seems calculated.
The message is not intended to be gentle. It’s meant to send a stark signal to the country, as well as please the Free Alberta and Take Back Alberta people in Premier Danielle Smith’s party.
From both those perspectives, it’s probably working.
Albertans do pay more into the national pension plan — and also employment insurance — than other Canadians. Because the population is younger and more regularly employed, they also take less out.
But this isn’t federal oppression. It’s a direct result of higher general prosperity and wage levels. We pay more because we have more.
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The premier and her ministers know this full well. They also realize, and never mention, that the CPP is a federal bargain with individuals, not with provinces. But they claim the CPP money as if it belonged to the provincial government.
Remarks in 2019 from Ben Eisen, a senior fellow at the UCP-friendly Fraser Institute, gave a prescient view of the UCP’s thinking today.
“Now, there’s nothing wrong with Alberta paying more in taxes than it receives in programs and services — this is primarily because per-capita incomes in the province are still higher than anywhere else in Canada,” he wrote.
“Still, it’s critical for Canadians across the country to recognize the magnitude of Alberta’s contribution to the health of the country’s finances, and to therefore understand how important a prosperous Alberta is to the well-being of the country.”
That’s exactly what all this fuss is about. Unfortunately, the effort to shock Canada also misleads Albertans.
Don Braid’s column appears regularly in the Herald